At the equilibrium price, quantity demanded is equal to quantity supplied
a. True
b. False
Indicate whether the statement is true or false
True
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If supply is perfectly elastic, a sales tax imposed on sellers is paid by
A) only the buyers. B) only the sellers. C) both the buyers and sellers. D) None of the above answers is correct.
Many economists criticize protectionism because it causes losses to consumers and eliminates jobs in domestic industries that use protected products. Why, then, do some people support protectionism?
A) Supporters of protectionism in high-income countries believe that wages will fall as a result of competition with firms from developing countries. B) Supporters of protectionism believe that free trade will lead to inflation. C) The criticisms of economists are based on theory. In fact, protectionism increases consumer and producer surplus as well as employment. D) Supporters of protectionism believe free trade will cause their countries to lose their comparative advantage.
When asset prices rise above their fundamental economic values, a(n) ________ occurs
A) asset-price bubble B) liability war C) decline in lending D) decrease in moral hazard
Labor supply
A) must necessarily increase when the real wage increases. B) increases if the substitution effect exceeds the income effect. C) is increasing and then decreasing in the real wage. D) increases when taxes increase.