A freeze that destroys all of the Florida orange crop would result in
a. a lower price for orange juice as people will switch to Texas grapefruit juice
b. a higher price for orange juice as people demand more orange juice
c. no change in the price for orange juice
d. a higher price for orange juice due to the decrease in supply of oranges
e. a higher price for orange juice due to the increase in demand for oranges
Answer: d. a higher price for orange juice due to the decrease in supply of oranges
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If a 10% currency appreciation results in a 10% decrease in the price of imported goods, then this is called
A) a complete pass-through. B) the Marshall Lerner condition. C) a partial pass-through. D) import inflation.
Which of the following statements is FALSE about the demand curve?
A. A change in demand is graphically shown by shifting the entire demand curve. B. An increase in demand shifts the demand curve to the left, closer to the price axis. C. When only the price of a good changes, there is movement along the demand curve but no change in demand. D. When demand decreases, there is a drop in the quantity demanded at each price.
The greater is the risk of non-repayment of a loan, the
A. longer is the expected time to repay the loan. B. lower is the expected rate of interest. C. higher is the expected rate of interest. D. lower is the handling charges for the loan.
The individual firm operating in a perfectly competitive labor market
A. can hire more labor only by offering a higher wage. B. can buy all the labor it wants at the going market wage rate. C. faces an inelastic demand for labor. D. will pay less to the additional labor employed.