If supply and demand both simultaneously increase
A) the market clearing price definitely rises, and the equilibrium quantity definitely falls.
B) the market clearing price definitely rises, and the effect on the equilibrium quantity is indeterminate.
C) the market clearing price definitely falls, and the effect on the equilibrium quantity is indeterminate.
D) the effect on the market clearing price is indeterminate, and the equilibrium quantity definitely rises.
Answer: D
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The consequences of price discrimination are
a. Consummate more transactions b. Extract more consumer surplus c. Increase producer surplus d. All of the above
In the absence of commitment devices, present-biased individuals are never as patient as they intend to be.
Answer the following statement true (T) or false (F)
Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real GDP and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. There is not enough information to determine what happens to these two macroeconomic variables. b. Real GDP falls, and reserve-related (central bank) transactions become more negative (or less positive). c. Real GDP rises, and reserve-related (central bank) transactions becomes more positive (or less negative). d. Real GDP and reserve-related (central bank) transactions remain the same. e. Real GDP falls, and reserve-related (central bank) transactions remain the same.
When supply increases and the supply curve shifts to the right, equilibrium price ________ and equilibrium quantity ________
A) increases; decreases B) decreases; decreases C) increases; increases D) decreases; increases