Answer the following statements true (T) or false (F)
1. If the government subsidizes the car makers in the production of cars, then the supply of steel increases.
2. An increase in both supply and demand will lead to an increase in the equilibrium price and an indeterminate change in the equilibrium quantity.
3. A decrease in the price of digital cameras will cause the demand for memory cards to shift to the left.
4. If the demand for electronic readers and tablets increases, then their supply will increase as price rises.
1. FALSE
2. FALSE
3. FALSE
4. FALSE
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The exchange rate last month was $1 = 1.15 euros. This month it is $1 = 1.35 euros. We can say that the value of the dollar
A) fell; causing net exports to increase and aggregate demand to rise. B) fell; causing net exports to decrease and aggregate demand to fall. C) increased; causing net exports to decrease and aggregate demand to fall. D) increased; causing net exports to decrease and aggregate demand to rise.
Economists emphasize the importance of equilibrium in markets because
a. trading in markets can only occur at the equilibrium price and quantity b. the behavior of buyers and sellers will automatically guide the market toward the equilibrium price and quantity c. all buyers and sellers are better off at the equilibrium point than any other price and quantity combination d. it represents a compromise between sellers hoping for low prices and buyers searching for high prices e. it is the only price-quantity combination that guarantees that the poorest members of society can purchase the good or service
As a unit of accounting, money is used
A. to pay off future debts. B. to define prices of all other goods. C. to hold purchasing power over time. D. to exchange for goods and services.
Which statement best illustrates the law of diminishing returns?
A. The average total cost of the last unit of output produced is less than the average total cost of the preceding unit of output B. The marginal product of the last unit of a resource used is less than the marginal product of the preceding unit of resource C. The average product of the last unit of a resource used is less than the average product of the preceding unit of resource D. The marginal cost of the last unit of output produced is less than the marginal cost of the preceding unit of output