Assume there is an increase in demand in a perfectly competitive market that was initially in long-run equilibrium. Which of the following statements is false?
A) Consumers have shown that they now consider the good to be more valuable.
B) In the short run, profits will be lower than normal.
C) Resources from other industries will be attracted into the market.
D) Over time, the market supply curve will shift right.
B
You might also like to view...
Cyrus McCormick and Eli Whitney were important in the technology of
A. steel. B. automobiles. C. agriculture. D. oil.
The spread between price and marginal cost of an exhaustible resource must grow by the rate of interest so that
A) resource owners earn a profit. B) resource owners are willing to sell some of the resource in the future. C) the price of the resource remains constant in real terms. D) the marginal cost of extracting the resource declines.
Frannie spends her income on rice and beans. At her optimum, Frannie's
a. utility from consuming rice is equal to her utility from consuming beams. b. marginal utility of rice is equal to her marginal utility of beans. c. marginal utility per dollar spent on rice equals her marginal utility per dollar spent on beans. d. marginal rate of substitution is equal to 1.
Jose decides to join the Middle State University's football team when he learns that his health insurance will pay for any subsequent injury. This illustrates
A. a symmetric information problem. B. monopolistic behavior. C. oligopolistic behavior. D. a moral hazard problem.