Which of the following is true if the price of coffee increases?
a. The demand for tea, a substitute good, will decrease.
b. The demand for coffee will increase.
c. The demand for coffee and tea will decrease.
d. Both the demand for coffee and tea will increase.
e. The demand for tea, a substitute good, will increase.
e
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Answer the next question(s) based on the data contained in the following table.Units of LaborTotal ProductProduct Price00$2.201152.002281.803391.604481.405551.206601.10Assume that the firm is hiring labor in a purely competitive market. If the wage rate is $20, how many workers will the firm choose to employ?
A. 5 B. 4 C. 3 D. 2
Proponents of the interest-rate-based monetary policy transmission mechanism argue that when the Federal Reserve buys bonds, there will be
A) an increase in investment spending. B) a decrease in the money supply. C) a decrease in nominal Gross Domestic Product (GDP), but not in real income. D) a decrease in the price of outstanding bonds.
The concept of network externalities is most relevant to purchasers of
a. computer software. b. automobiles. c. television sets. d. radios.
If parking is a very scarce commodity on your campus, but a parking lot with bus service is available at a distant location for no charge, what policy would you recommend to the president to increase the student use of this distant, but "free," lot?