Suppose a scientific report states that fish contain dangerously high levels of mercury (toxic to humans). At the same time, the price of diesel fuel, used by fishermen to fuel their boats, falls. What is the effect on the market for fish?
A. A decrease in demand and supply; price and quantity sold falls
B. A decrease in demand and an increase in supply; price falls but the change in quantity is ambiguous
C. A decrease in demand and supply; price and quantity sold rises
D. A decrease in demand and a fall in price and quantity sold
Answer: B
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The idea that unequal incomes are unfair generally uses the ________ principle of fairness
A) big tradeoff B) involuntary exchange C) voluntary exchange D) it's not fair if the result isn't fair E) it's not fair if the rules aren't fair
The equation below gives the degree of economies of scope (SC):
SC = (C(Q1 ) + C(Q2 ) - C(Q1,Q2 )) / C(Q1,Q2 ) where C(Q1 ) is the cost of producing output Q1, C(Q2 ) is the cost of producing output Q2, and C(Q1,Q2 ) is the joint cost of producing both outputs. If SC is negative: A) there are neither economies nor diseconomies of scope. B) there are economies of scope. C) there are diseconomies of scope. D) there are both economies and diseconomies of scope.
When "stagflation" occurs
A. the economy experiences higher inflation rates and higher unemployment rates at the same time. B. the economy experiences lower inflation rates and lower unemployment rates at the same time. C. the economy experiences higher inflation rates and lower unemployment rates at the same time. D. the economy experiences lower inflation rates and higher unemployment rates at the same time.
The nominal interest rate minus the real interest rate approximately equals the
A) rate of increase in the amount of investment. B) inflation rate. C) rate of increase in the income. D) rate the bank receives to cover lending costs.