The statement "other things being equal" in the law of demand means all of the following remain constant EXCEPT
A) consumer income.
B) the price of the good concerned in the law of demand.
C) the prices of substitutes.
D) tastes and preferences.
Answer: B
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The higher the bid in a first-price sealed-bid auction, the ________ the chances of winning and the ________ the surplus earned
A) higher; higher B) higher; lower C) lower; higher D) lower; lower
Suppose pigs (P) can be fed corn-based feed (C) or soybean-based feed (S) such that the production function is P = 2C + 5S. The expansion path depends
a. on the price of corn-based feed only. b. on the price of soybean-based feed only. c. on neither the price of corn-based or soybean-based feed. d. on whether the price of corn-based feed is greater than or less than 2/5 the price of soybean-based feed.
A rational consumer should not consume more of a good when:
a. total utility is decreasing. b. marginal utility is diminishing. c. both a and b. d. income is decreasing. e. the price is high.
Firms may be tempted to cheat on cartel agreements by: a. raising both price and output
b. lowering both price and output. c. raising price and reducing output. d. lowering price and increasing output.