In product markets:
a. Businesses sell resources to households
b. Businesses sell goods and services to households
c. Households sell products to business firms
d. Households sell resources to business firms
b. Businesses sell goods and services to households
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In the U.S. economy, the quantity of donuts produced each day is determined by the
A) U.S. Food and Drug Administration. B) U.S. Department of Health and Human Services. C) Donut Association of America. D) individual decisions of thousands of donut makers.
Suppose a perfectly competitive constant-cost industry is in long-run equilibrium when market demand suddenly increases. What would probably happen to a firm in this industry in the long run?
a. It would experience no change for the original equilibrium b. It would experience a higher equilibrium price c. It would experience a lower equilibrium price d. It would experience the same equilibrium price but would reduce its output e. It would experience higher average total costs and would reduce its output
If those who consumed common resources were subject to a tax that was equal to the external costs that they imposed due to the negative externality created, their demand curve would shift:
A. down and they would consume more. B. down and they would consume less. C. up and they would consume less. D. up and they would consume more.
Suppose a tax is imposed on sellers. The more inelastic the demand for the taxed item, the
A) greater the share of the tax paid by sellers. B) smaller the deadweight loss from the tax. C) larger the decrease in consumption because of the tax. D) All of the above answers are correct.