If the supply of a good decreased, what would be the effect on the equilibrium price and quantity?
A. Price would increase, and quantity would decrease.
B. Price would decrease, and quantity would decrease.
C. Price would increase, and quantity would increase.
D. Price would decrease, and quantity would increase.
Answer: A
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Past expenses are irrelevant to supply decisions, because
A) expenses incurred in the past never affect the opportunities available in the present. B) it is essential to avoid bankruptcy. C) no one remembers the past. D) supply decisions depend on opportunities that will have to be forgone, not opportunities already forgone.
In the 1980s, one of the most common sights in the socialist countries, such as the former Soviet Union and North Korea, were long lines for bread, sugar, and other necessities. These countries had price ceilings on these necessities
Some of the socialist nations, such as the former Soviet Union, have moved to a market economy by lifting the price ceilings, while others, such as North Korea, have retained their price ceilings. What prediction do you make about the presence (or absence) of long lines today in the former Soviet Union and North Korea? Explain your answer.
Under a system of marketable pollution permits, a firm with relatively low abatement costs will buy permits from a firm with relatively high abatement costs.
Answer the following statement true (T) or false (F)
The supply curve for umbrellas
A) shows the supply of umbrellas consumers are willing and able to buy at any given price. B) is downward sloping. C) shows the relationship between the quantity of umbrellas firms are willing and able to supply and the quantity of umbrellas consumers are willing and able to purchase. D) shows the relationship between the price of umbrellas and the quantity of umbrellas supplied.