An increase in the price of a product will reduce the amount of it purchased because:
A. supply curves are upsloping.
B. consumers substitute relatively high-priced for relatively low-priced products.
C. the higher price means that real incomes have risen.
D. consumers will substitute other products for the one whose price has risen.
Answer: D
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Draw a graph to illustrate the effect of an increase in demand on the price and quantity in a market
What will be an ideal response?
Central banks can increase the money supply by:
a. Buying foreign exchange. b. Raising margin requirements. c. Increasing the discount rate. d. All of the above. e. None of the above.
The economic principle that "unemployment rate will tend to increase as the economy moves into a recession" is an example of:
A. A normative statement B. An assumption C. A loaded terminology D. A generalization
An injunction is a court order that forbids the continuation of behavior that leads to benefits.
Answer the following statement true (T) or false (F)