In which of the following situations will both market clearing price and the equilibrium quantity decrease?
A) an increase in demand and no change in supply
B) an increase in supply with no change in demand
C) a decrease in supply with no change in demand
D) a decrease in demand with no change in supply
D
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Suppose a perfectly competitive market is in long-run equilibrium. If there is a permanent increase in demand,
A) at least in the short run, some firms will increase their output. B) at least in the short run, the price will increase initially. C) new firms will enter the market. D) All of the above answers are correct.
Refer to Table 17-2. The firm represented in the diagram
A) has market power in the output market. B) has market power in both the factor and product market. C) has market power in the factor market. D) has no market power in the factor or product market.
Most of the change from 1980 to 1987 in U.S. net capital outflow as a percent of GDP was due to a(n)
a. decrease in U.S. investment. b. decrease in U.S. national saving. c. increase in U.S. investment. d. increase in U.S. national saving.
Suppose Joe is maximizing total utility within his budget constraint. If the price of the last pair of jeans purchased is $25 and it yields 100 units of extra satisfaction and the price of the last shirt purchased is $20, then, using the rule of equal
marginal utility per dollar spent, the extra satisfaction received from the last shirt must be A) 2,000 units of utility. B) 500 units of utility. C) 100 units of utility. D) 80 units of utility.