One reason that the quantity demanded of a good increases when its price falls is that the:
A. price decline shifts the supply curve to the left.
B. lower price shifts the demand curve to the left.
C. lower price shifts the demand curve to the right.
D. lower price increases the real incomes of buyers, enabling them to buy more.
Answer: D
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A firm pays Pam $40 per hour to assemble personal computers. Each day, Pam can assemble 4 computers if she works 1 hour, 7 computers if she works 2 hours, 9 computers if she works 3 hours, and 10 computers if she works 4 hours. Pam cannot work more than 4 hours day. Each computer consists of a motherboard, a hard drive, a case, a monitor, a keyboard, and a mouse. The total cost of these parts is $600 per computer. If the firm sells each computer for $625, then how many hours a day should the firm employ Pam to maximize its net benefit from her employment?
A. 1 hour B. 3 hours C. 2 hours D. 4 hours
In the long-run ISLM model and with everything else held constant, an increase in the money supply leaves the level of output and interest rates unchanged, an outcome called
A) interest rate overshooting. B) long-run money neutrality. C) long-run crowding out. D) the long-run Phillips curve.
The marginal revenue product curve slopes downward only if the firm is a price searcher in the product market
a. True b. False
Workers in a nearby pizza restaurant may indirectly enjoy income increases from a nearby construction process
a. True b. False Indicate whether the statement is true or false