Assume, in a competitive market, price is initially below the equilibrium level. We predict that price will:
A. decrease, quantity demanded will decrease, and quantity supplied will increase.
B. increase, quantity demanded will increase, and quantity supplied will decrease.
C. decrease and quantity demanded and quantity supplied will both decrease.
D. increase, quantity demanded will decrease, and quantity supplied will increase.
Answer: D
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The conclusion that the economy has price flexibility, wage flexibility, and perfectly competitive markets justifies
A) rational policy making. B) passive policy making. C) active policy making. D) none of the above.
The relationship between the inputs employed by a firm and the maximum output it can produce with those inputs is called the firm's
A) total factor productivity. B) marginal production level. C) technological ratio. D) production function.
Based on the transactions in the above table, what is the change in the U.S. capital account?
A) $9,800 B) $10,000 C) -$20,000 D) -$20,200
If producing a good generates pollution (a negative externality), from a social perspective
a. The price will be too low and the quantity produced will be too low b. The price will be too low and the quantity produced will be too high c. The price will be too high and the quantity produced will be too low d. The price will be too high and the quantity produced will be too high e. The price will be too low but the quantity produced will be correct