When there is a shortage of a product in an unregulated market, there is a tendency for
A. price to rise.
B. quantity supplied to decrease.
C. price to fall.
D. quantity demanded to increase.
Answer: A
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Shirley has to choose between a two-day trip and a three-day trip to Hollywood. The table below shows the expected benefit and cost for the different days
Using optimization in levels and optimization in differences, determine what Shirley's optimum decision should be. Does the decision differ with the techniques used? Which technique is faster to implement? Day Cost Benefit 1 $750 $800 2 $900 $1,000 3 $600 $800
Suppose the market demand function in a certain market where Q is measured in thousands of units is Qd = 20 - 2.5P, and the market supply function is Qs = 2.5P - 7.5. How much deadweight loss would there be in this market if the quantity bought and sold was 5,000 units?
A. $0.63 B. $62.50 C. $625 D. $6,250
If the long-run Phillips curve is vertical, then any government policy designed to lower:
a. unemployment will not change the unemployment rate and only increase the inflation rate. b. unemployment will work leaving the inflation rate unchanged. c. inflation will cause employment to rise. d. unemployment will work causing the inflation rate to fall. e. unemployment will work causing inflation to rise.
Even though households do not actually purchase certain items, the government estimates and adds to the consumption component what the household would pay for these items in the marketplace. An example of this type of item is
a. a car that an individual builds from parts of old cars b. food that a farm family grows for themselves c. a pond that a household member digs by hand d. police and fire protection e. a barn that a household builds on their own property