The prices of related goods matters when determining supply because it affects:
A. the competition in the market.
B. the availability of substitute goods.
C. whether or not your good will sell.
D. the opportunity cost of production.
Answer: D
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If a country has a comparative advantage in producing a product, it must also have an absolute advantage in producing that product
Indicate whether the statement is true or false
The resource market is different from the product market because
a. in the resource market, firms don't maximize profit b. in the resource market, households don't maximize utility c. in the resource market, firms are demanders and households are suppliers d. supply and demand do not apply in the resource market e. supply and demand do not apply in the product market
Assume that concerns about tap water potability increase demand for bottled water, and that the new demand (D’ ) is represented by the following: D’ = MSB’ = 7 – 0.1Q What is the new equilibrium quantity (QE’ ) and price (PE’) in the U.S. bottled water market?
Suppose that the U.S. market for bottled water is modeled as follows: S = MSC = 1 + 0.3Q D = MSB = 5 – 0.1Q, whereQ is billions of gallons per year and MSC and MSB are in dollars per gallon.
Point A in the figure below is: 
A. inefficient since it produces 20 units of output at a cost greater than the minimum cost. B. inefficient since it produces 10 units of output at a cost greater than the minimum cost. C. efficient since it produces 20 units of output at the lowest possible cost. D. efficient since it produces 10 units of output at the lowest possible cost.