Which of the following best describes the movement from E1 to E2?
a. a decrease in supply
b. an increase in supply
c. a movement along the supply curve
d. a decrease in demand
Answer: a. a decrease in supply
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Robert is a doctor who earns an average hourly wage of $80. His wife is a teacher and earns an average hourly wage of $35. His daughter works in her college library and earns $12 per hour while his son is a lawyer and earns $60 per hour
If one of them must stay back at the house on a working day to look after their ailing pet, who can do it at the lowest opportunity cost? A) His son B) Robert C) His wife D) His daughter Mike and John work as waiters in a restaurant. Mike can efficiently wait on 10 customers per hour while John can efficiently wait on 7 customers per hour. The restaurant also has a bar. If both of them work as bartenders, Mike is able to serve 9 customers per hour while John is able to serve 10 customers per hour.
Which of the following leads to the tragedy of the commons?
A) The use of common pool resources above the socially optimal level B) The low level of satisfaction derived from the use of common pool resources C) The high rate of taxation on common pool resources D) The tendency of consumers to use common pool resources without paying for them
The function of financial intermediaries is to transfer purchasing power from
A. Consumers to savers. B. Dissavers to savers. C. Dissavers to consumers. D. Savers to dissavers.
Which of the following policy options would tend to offset each other?
A. An increase in the reserve requirement and an open market sale by the Fed. B. An increase in the discount rate and a decrease in the tax rate. C. A decrease in the discount rate and a decrease in the reserve requirement. D. An increase in the tax rate and a decrease in government spending.