Suppose a medical study reveals new benefits to consuming beef and at the same time a bumper corn crop reduces the cost of feeding steers. The equilibrium quantity of beef will Question 23 options:
A. stay the same.
B. perhaps increase, decrease, or stay the same, but more information is needed to determine which it does.
C. definitely either stay the same or decrease.
D. decrease.
E. increase.
E. increase.
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A good will tend to be more price elastic if it
A. is a luxury good. B. has no close substitutes. C. is a small part of the household budget. D. is a necessity.
It makes economic sense to borrow when you are buying something with a ________________ payoff, even if it creates a trade deficit.
a. long-run b. short-run c. positive d. negative
Which of the following do you know for certain is true? a. The marginal utility of Diane's second Coke is greater than the marginal utility of her third pretzel
b. The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third pretzel. c. The marginal utility of Diane's second Coke is greater than the marginal utility of her third Coke. d. The total utility of two Cokes is greater than the total utility of three Cokes. e. The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third Coke.
The backward-bending supply curve for labor shows how an increase in wages affects the number of hours worked. The “backward bend” is the part of the curve that shows that some people:
a. have no flexibility in the number of hours they work. b. work more hours when income rises. c. work more hours when income falls. d. work fewer hours when income rises.