Suppose the price of lumber decreases. In the market for new homes, we would expect which of the following to occur?
A) the market clearing price will fall and the equilibrium quantity will rise.
B) the market clearing price will rise and the equilibrium quantity will fall.
C) both the market clearing price and the equilibrium quantity will fall.
D) both the market clearing price and the equilibrium quantity will rise.
Answer: A
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Real demand for money is positively related to the level of real income in the economy
Indicate whether the statement is true or false
Which of the following statements is not correct?
a. Medical research can be an example of a public good. b. The private market will tend to undersupply public goods. c. The free-rider problem occurs when a good is nonexcludable. d. All goods provided by the government are public goods.
Figure 34-5
?
From the graph in Figure 34-5 (curves show output per unit of labor input), one can infer that
A. Japan has an absolute advantage in TVs and computers, but a comparative advantage only in TVs. B. Japan has only a comparative advantage in TVs. C. Japan has an absolute advantage in both TVs and computers, but a comparative advantage only in computers. D. China has a comparative advantage in computers.
A government using fiscal policy in an attempt to stimulate the economy would do which of the following?
A) Raise taxes. B)raise government spending. C) Lower interest rates. D) Raise interest rates.