The supply curve illustrates that firms:
A. decrease the quantity supplied of a good when input prices rise.
B. increase the quantity supplied of a good when its price rises.
C. decrease the supply of a good when its price rises.
D. increase the supply of a good when its price rises.
Answer: B
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Suppose an oil company wants to make its total revenue as large as possible. It should charge a price at which the demand for oil is:
a. elastic. b. unitary elastic. c. inelastic. d. perfectly inelastic.
In the Utah Pie case, the economic effect of the Supreme Court decision was to:
a. prohibit the merger of two small pie companies. b. encourage competition by ruling that the national competitors had engaged in illegal price discrimination. c. encourage competition by ruling that the national competitors had not engaged in illegal price discrimination. d. discourage competition by national competitors in the Salt Lake City market.
Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency rises. b. The quantity of real loanable funds per time period falls, and nominal value of the domestic currency rises. c. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency remains the same. d. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency falls. e. There is not enough information to determine what happens to these two macroeconomic variables.
A decrease in supply shifts the supply curve to the left
a. True b. False Indicate whether the statement is true or false