"The price of compact fluorescent light bulbs fell because of improvements in production technology. As a result, the demand for incandescent light bulbs decreased
This caused the price of incandescent light bulbs to fall; as the price of incandescent light bulbs fell the demand for incandescent light bulbs decreased even further." Evaluate this statement.
A) The statement is false because the demand for incandescent light bulbs would increase as the price of compact fluorescent light bulbs fell.
B) The statement is false because it confuses the law of demand with the law of supply.
C) The statement is false. A decrease in the price of compact fluorescent light bulbs would decrease the demand for incandescent light bulbs, but a decrease in the price of incandescent light bulbs would not cause the demand for incandescent light bulbs to decrease.
D) The statement is false because compact fluorescent light bulbs producers would not reduce their prices as a result of improvements in technology; doing so would reduce their profits.
C
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Activities that encourage faster growth are
A) high levels of consumption and low levels of savings. B) high levels of saving and investment in human capital. C) imposing trade barriers to limit international trade and thereby protect national industries. D) limiting property rights so that everyone can use any invention. E) taxes on saving that serve to encourage more spending and less saving.
In the United States, most periods of very high inflation occurred
A) during times of war. B) during recessions. C) in the past 25 years. D) before the year 1800.
If Happy Campers, Campers R Us, and Happy Trails each have a market share of 22 percent, according to Chinese law, Happy Campers ________ be considered a dominant firm because the total market share across the three firms is ________ percent.
A) would; 66 B) would; 22 C) would not; 66 D) would not; 22
By offering training to workers whose firms laid them off because of competition from foreign firms, the federal government is attempting to reduce
A) frictional unemployment. B) structural unemployment. C) cyclical unemployment. D) seasonal unemployment.