In both price-taker and competitive price-searcher markets, when an increase in market demand disrupts a long-run equilibrium, it will lead to
a. higher short-run prices and long-run profits.
b. higher short-run prices, short-run profits, and the entry of additional firms into the market.
c. higher short-run prices and the exit of firms from the market due to economies of scale.
d. no change in prices in the short run, but new firms will enter in the long run.
B
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The price elasticity of demand coefficient for a good will be lower:
a. if there are few substitutes for the good. b. if expenditure on it is a small part of one's budget. c. both a and b are true. d. neither a nor b are true.
The impact of an increase in oil prices stemming from the growth of demand is probably going to ____ the wages of petroleum engineers
a. decrease b. increase c. leave unaffected d. be impossible to predict
In a properly functioning free market
a. the price of any good reflects its marginal utility to consumers. b. price will equal marginal cost. c. the invisible hand will assure that society's resources are used efficiently. d. All of the above are correct.
Saving is a(n) ________ and wealth is a(n) ________.
A. asset; liability B. flow; stock C. liability; asset D. stock; flow