If you overheard a farmer discussing his planting plans for the upcoming season, and he said "The price of corn has gone way up. I know I'll have to put some money into fertilizer on that field on the hill that's been idle all these years, but it will be worth it this year." This would be consistent with which justification for an upward sloping supply curve
A. the real-balance effect?
B. increasing marginal cost?
C. diminishing marginal utility?
D. the need for higher prices in one good to motivate a shift in production from another?
Answer: B
You might also like to view...
Expansionary monetary policy is achieved by:
A) decreasing the amount of bank reserves and lowering the federal funds rate. B) decreasing the amount of bank reserves and raising the federal funds rate. C) increasing the amount of bank reserves and lowering the federal funds rate. D) increasing the amount of bank reserves and raising the federal funds rate.
The Wall Street Journal publishes an exchange rate of US$/C$ = 0.714, where US$ represents the U.S. dollar and C$ represents the Canadian dollar. What does this mean?
a. The Canadian dollar price of one U.S. dollar is US$0.714. b. The Canadian dollar price of one U.S. dollar is C$0.714. c. The U.S. dollar price of one Canadian dollar is C$1.40. d. The U.S. dollar price of one Canadian dollar is US$1.40 e. The U.S. dollar price of one Canadian dollar is US$0.714.
Return
What will be an ideal response?
Which of the following algebraic forms of a demand curve yields an isoelastic demand curve (i.e. a demand with constant elasticity)?
A. Q = a - bP + cI B. log(Q) = a - b log(P) + c log(I) C. Q = a - b log(P) + c log(I) D. log(Q) = bP + cI