A decrease in supply will occur when
A. the supply curve shifts upward to the left.
B. the supply curve shifts downward to the right.
C. the demand curve shifts downward to the left.
D. the demand curve shifts upward to the right.
Answer: A
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Suppose Always There Wireless serves 100 high-demand wireless consumers, who each have a monthly demand curve for wireless minutes of QdH = 200 - 100P, and 300 low-demand consumers, who each have a monthly demand curve for wireless minutes of QdL = 100 - 100P, where P is the per-minute price in dollars. The marginal cost is $0.25 per minute. Suppose Always There Wireless charges $0.25 per minute. How many minutes will low-demand consumers purchase?
A. 75 B. 175 C. 200 D. 100
A market failure is most likely to occur when:
A. a sole producer of a good faces no threat of competition. B. several producers of a good compete for customers by having price wars. C. several producers of a good search for the lowest-cost method of production. D. many producers produce identical products, and only the consumers and producers are affected by the transactions.
Policymakers use taxes
a. to raise revenue for public purposes but not to influence market outcomes. b. both to raise revenue for public purposes and to influence market outcomes. c. when they realize that price controls alone are insufficient to correct market inequities. d. only in those markets in which the burden of the tax falls clearly on the sellers.
In 2006, Jan and Lou bought a house for $100,000. After a year, they still owed $98,000, but the home was worth $220,000, so they used it as collateral to get a $90,000 loan to buy a boat. What have they done?
a. taken out a hybrid loan b. bought a mortgage-backed security c. borrowed against their equity d. entered a subprime mortgage