An increase in the price of a product signals consumers that there is an overage and the product should perhaps be economized on.
Select whether the statement is true or false.
A. True
B. False
B. False
This statement is false. An increase in the price of a product signals consumers that there is a shortage and the product should perhaps be economized on.
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When actual output is less than potential output, there is ________ output gap and the inflation rate will ________.
A. an expansionary; be lower than the expected rate of inflation B. a recessionary; exceed the expected rate of inflation C. a recessionary; be lower than the expected rate of inflation D. an expansionary; exceed the expected rate of inflation
When the market price is held above the competitive level, the deadweight loss is composed of:
A) producer surplus losses associated with units that used to be traded on the market but are no longer exchanged. B) consumer surplus losses associated with units that used to be traded on the market but are no longer exchanged. C) producer and consumer surplus losses associated with units that used to be traded on the market but are no longer exchanged. D) There is no deadweight loss if the government uses a price floor policy to increase the price.
In the case of positive externalities, too many people consume and produce the good compared to what is desired by society
a. True b. False Indicate whether the statement is true or false
Angelina, age seven, decides to dress up like Princess Fiona for Halloween. What is the opportunity cost of her decision?
A. the cost of the costume B. the fact that she can't dress up like Dora the Explorer, her second choice C. zero, because seven-year-olds don't have opportunity costs D. the cost of the Lady Gaga costume which she did not want