Select the letter of the diagram in Figure 28.1 that best represents the effect of each event on the United States wheat market, ceteris paribus: The federal government decides to no longer purchase wheat from farmers. (See Figure 29.4.)
A. a.
B. b.
C. c.
D. d.
Answer: C
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Which of the following is a feature of models?
A) Models are the same as hypotheses. B) Models help making predictions for the future. C) Models are more complicated than real life phenomena. D) Models are as complex as the phenomenon being studied.
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If firms under perfect competition are receiving positive economic profits in the short run, then which of the following will occur in the adjustment to perfect competition in the long run?
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