If the demand for one good decreases when the price of another good increases, the two goods are ________ goods.
A. normal
B. inferior
C. complementary
D. substitute
Answer: C
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If average labor productivity decreases while population and the number of employed workers remain constant, then total output:
A. increases. B. decreases. C. may increase or decrease. D. remains constant.
The textbook for your class was not produced in a perfectly competitive industry because
A) there are so few firms in the industry that market shares are not small, and firms' decisions have an impact on market price. B) upper-division microeconomics texts are not all alike. C) it is not costless to enter or exit the textbook industry. D) of all of the above reasons.
The median voter model predicts that
A) both candidates in a two-person race will definitely move toward the middle of the political spectrum as the election approaches. B) the candidate (in a two-person race) closer to the middle of the political spectrum (closer to the median voter) on election day will win the election. C) conservatives have a higher probability of winning elections than liberals. D) liberals have a higher probability of winning elections than conservatives. E) voters will often be rationally ignorant of important political issues.
The law of demand states that the quantity demanded of a good is inversely related to the price of that good. Therefore, as the price of a good goes:
A. down, the quantity demanded stays the same. B. up, the quantity demanded goes down. C. up, the quantity demanded also goes up. D. down, the quantity demanded goes down.