When the price of only one good rises, the relative price of that good
A) falls.
B) rises.
C) does not change.
D) rises if it is a normal good and falls if it is an inferior good.
B
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
An airline's flight is about to take off. It has a few empty seats left aboard. If it lowers its prices, it can fill the remaining seats and fly at full capacity. What should be done?
a. Sell the additional standby seats at a discount since the marginal costs of the additional passenger are almost zero and fly at full capacity b. Sell the additional standby seats without a discount c. Don't offer the additional seats for any price d. none of the above
A temporary decrease in the price of oil would be considered a:
A. short-run supply shock. B. long-run supply shock. C. demand shock. D. The changing price of oil would not affect any of these.
The Celler-Kefauver Act of 1950:
A. outlawed price-fixing. B. amended the Sherman Act. C. amended the Clayton Act. D. created the Civil Aeronautics Board (CAB).