When the price of a good is
A) below the equilibrium price, quantity supplied exceeds quantity demanded and price rises.
B) below the equilibrium price, quantity demanded exceeds quantity supplied and price falls.
C) above the equilibrium price, quantity supplied exceeds quantity demanded and price falls.
D) above the equilibrium price, quantity demanded exceeds quantity supplied and price rises.
C
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Is it true that in the long run it is impossible for firms functioning in a perfectly competitive market to earn positive economic profits? Explain your answer
What will be an ideal response?
An increase in a consumer's income creates a
A) rightward parallel shift of the budget line. B) leftward parallel shift of the budget line. C) rightward rotation of the budget line, so that the budget line becomes steeper. D) leftward rotation of the budget line, so that the budget line becomes steeper.
Refer to Figure 10.9. Other things equal, a decrease in the nominal money supply by the Fed is best represented as a change in equilibrium from
A) point A to point B. B) point A to point D. C) point C to point B. D) point C to point D.
If Abigail can produce 4 tablets or 3 cellphones in a day, while Jacob can produce 1 tablet or 2 cellphones, then it is correct to state that
A) Abigail has a comparative advantage in producing cellphones. B) Abigail has an absolute advantage in producing tablets but not cellphones. C) Jacob has a comparative advantage in cellphones. D) Jacob has an absolute advantage in cellphones.