An unexpected decrease in wealth or nonlabor income leads to
A. a zero effect on labor supply.
B. an uncertain effect on labor supply.
C. an increase in labor supply.
D. a decrease in labor supply.
Answer: C
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Ramen noodles are a staple food item for many college students. Ramen noodles are very inexpensive, easy to prepare, and can be combined easily with other foods. After students graduate, find employment, and earn a higher income, they decrease their Ramen noodle purchases significantly. In this case, Ramen noodles are
A) a normal good. B) an inferior good. C) a complement for higher income people. D) a substitute good. E) None of the above answers is correct.
Which statement is true?
A. After settling its case with the Justice Department, Microsoft will not face any further serious litigation for at least another decade. B. Most of the largest corporate mergers in U.S. history took place between 1985 and 1995. C. Deregulation has been a complete failure. D. The history of antitrust goes back to the late 19th century.
Suppose the quantity demanded is 1,000 million bushels of peaches per year when the price is $3 per bushel and 1,500 million bushels when the price is $1 per bushel. The price elasticity of demand in this range of the demand curve is:
A. elastic. B. inelastic. C. unitary elastic. D. infinitely elastic.
It has been argued that in the long run monopolistic competition is inefficient because
A) there are too many firms, each with excess capacity, producing too little output. B) there are few many firms, each with excess capacity, producing too much output. C) minimum average total costs are achieved but price exceeds marginal cost. D) minimum average total costs are not achieved and marginal cost exceeds price.