If the demand for leather decreases, producer surplus in the leather market
a. increases.
b. decreases.
c. remains the same.
d. may increase, decrease, or remain the same.
b
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A firm's fixed cost divided by its level of output is equal to its:
A. variable cost. B. start-up cost. C. explicit cost. D. average fixed cost.
If a good has an income elasticity of 0.18, then it is:
A. a normal good, and a necessity. B. a normal good, and a luxury good. C. an inferior good, and a necessity. D. an inferior good, and a luxury.
Assume the graph shown represents the market for pizzas sold in an hour. If the original equilibrium was D and S1. Which of the following is true when S1 shifted to S2?
A. Equilibrium price increased by $5. B. Equilibrium quantity increased by 20. C. Equilibrium quantity increased by 30. D. Equilibrium price decreased by $5.
If Mr. Garrison is paid an interest rate of 4% on his savings, but the inflation rate is 7%, the real interest rate Mr. Garrison earns is
A. 28%. B. 4%. C. -3%. D. -7%.