Economists make a distinction between changes in quantity demanded and changes in demand:
a) Because the demand curve shifts whenever there is a change in quantity demanded.
b) To distinguish a surplus from a shortage.
c) Because the supply curve shifts whenever there is a change in demand.
d) To distinguish a movement along a demand curve from a shift of the demand curve.
Answer: d) To distinguish a movement along a demand curve from a shift of the demand curve.
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There is no need to allocate property rights in a market-based firm
Indicate whether the statement is true or false
Since 1948, the history of real wage rates generally shows that
a. prices and wages have risen at the same rate. b. prices have risen at a slower rate than wages. c. prices have risen faster than wages. d. real wages have remained constant over the period.
Suppose the U.S. Government banned the sale and production of cigarettes. What are likely effects of this action on the market for cigarettes?