An increase in supply will have what effect on equilibrium price and quantity?
A. Price will increase; quantity will decrease.
B. Price will decrease; quantity will increase.
C. Both price and quantity will increase.
D. Both price and quantity will decrease.
Answer: B
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According to the “law” of demand, we would expect
A. the demand curve to be negatively sloped. B. the demand curve to be positively sloped. C. the total quantity demanded by the market to move in the same direction as price. D. marginal utility to increase as quantity demanded increases.
If American imports run chronically above our exports, a trade deficit develops
a. True b. False Indicate whether the statement is true or false
The Board of Governors of the Federal Reserve does each of the following, except
A. sit on the Federal Open Market Committee. B. serve on the Board at the pleasure of the President, who can make individual governors resign at any time. C. carry out monetary policy. D. raise and lower reserve requirements.
Secular deflation
A. cannot exist in a capitalistic economy. B. has been a serious problem during the last three decades in the United States. C. has not been present in the United States since 1960. D. although present, has not been a problem during the last three decades in the United States.