The figure above shows the market for coffee. Coffee is a normal good. If consumers' incomes fall, the efficient quantity of coffee will ________ and the producer surplus will ________
A) increase; increase
B) increase; decrease
C) decrease; decrease
D) decrease; increase
C
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Which of the following has been confirmed by empirical tests of the Ricardian model?
A) All predictions of the model for a multi-product, multi-country world are highly unrealistic. B) The existence of nontraded goods results in a high degree of specialization among countries. C) International trade has no impact on income distribution. D) The unimportance of economies of scale as a cause of trade. E) Companies tend to export goods in which they have a relatively high level of productivity.
Which of the following inputs is most likely to be "fixed" in the short run?
A) Labor. B) Capital. C) Energy. D) Raw Material.
A currency devaluation is a(n):
A. increase in the official value of a currency in a fixed-exchange-rate system. B. decrease in the value of a currency relative to other currencies. C. reduction in the official value of a currency in a fixed-exchange-rate system. D. increase in the value of a currency relative to other currencies.
Under the Bretton Woods system, devaluation was
A. normal. B. routine. C. rare. D. a last resort.