Harvey Rabbitt pays for monthly cable TV service. Last week, the cable company informed Harvey that his monthly cable price would go down because the city council has granted approval for three new cable companies to service his area. How is the market
for cable TV services affected by this?
A) There is an increase in the supply of cable TV service.
B) There is a decrease in the demand for cable TV service.
C) There is a decrease in the quantity of cable TV service supplied.
D) There is a decrease in the supply of cable TV service.
Answer: A
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The sharp reduction in marginal tax rates during the 1980s
a. reduced the incentive of high-income Americans to work. b. increased the incentive of high-income Americans to utilize tax shelters. c. increased the unemployment rate of high-income Americans. d. increased the visible income of high-income Americans.
If capital flows freely between countries and a country has a fixed exchange rate, one thing you know is that the country:
A. exports more than it imports. B. cannot have a discretionary monetary policy. C. must have ample gold reserves. D. must be running large trade deficits
The government passes a law which doubles the wages of all workers. Aggregate supply will ________, and real GDP will ________, and the price level will ________
A) increase; remain the same; increase. B) remain the same; increase; increase. C) increase; increase; remain the same. D) decrease; increase; increase. E) decrease; decrease; increase.
In the long run, a profit-maximizing monopolist
a. earns zero economic profit. b. produces the same amount as a perfectly competitive industry. c. receives a higher price for his output than a perfectly competitive firm. d. produces at the output level that minimizes his long-run average total cost.