Assume that coffee and tea are substitutes. When the price of coffee increases:
A. the demand for tea decreases.
B. the demand for tea increases.
C. the supply of tea increases.
D. the supply of tea decreases.
Answer: B
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Refer to Figure 2-2. At Point A in the production possibilities graph shown above, the economy:
A. is not using its resources efficiently. B. is using its resources efficiently while producing clothing but no food. C. is using its resources efficiently while producing food but no clothing. D. is using its resources efficiently to produce both food and clothing.
A shift in a curve represents a change in:
a. the variable on the horizontal axis. b. the variable on the vertical axis. c. a third variable that is not on either axis. d. any variable that is relevant to the relationship being graphed.
Variable inputs are those whose
a. quantity changes as the level of output changes b. costs are irreversible c. quantity remains constant regardless of the level of output d. costs are considered sunk costs e. price is continuously changing
The initial stage of the procedure in which a union and an employer negotiate over a contract is known as
a. featherbedding. b. collective bargaining. c. mediation. d. arbitration.