If supply falls, what happens to equilibrium price and quantity?
What will be an ideal response?
price rises; quantity falls
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Sometimes you will hear economists argue that the infant industry argument against free trade is a weak one because these industries never seem to "grow up." What is meant by this argument?
What will be an ideal response?
In Europe, in 2005, Microsoft was penalized for______.
a. unfair labor practices b. price discrimination c. false advertising d. bundling products
Many economists believe that a family bases its spending decisions on its permanent, or average, income rather than on transitory income
a. True b. False Indicate whether the statement is true or false
If a monopolist is practicing perfect price discrimination, then the following equation is true:
A) MC = 1/2 MR at the profit-maximizing level of output. B) MR = 1/2 P for any unit. C) MR = P for all units. D) P = AVC at the profit-maximizing level of output. E) AR = ATC at the profit-maximizing level of output.