Which of the following statements is consistent with a decrease in supply?
A. There has been an advance in technology.
B. Consumers' incomes have increased.
C. The market price has decreased.
D. Prices of raw material inputs have increased.
Answer: D
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For an economy starting at full employment real GDP, a decrease in autonomous expenditure results in a(n)
A. inflationary output gap. B. increase in full-employment output. C. decrease in full-employment output. D. recessionary output gap.
Under a flexible exchange rate system, a decrease in the value of a domestic currency in terms of foreign currencies is referred to as
A) an appreciation. B) a depreciation. C) a devaluation. D) a revaluation.
In most societies, resources are allocated by
a. a single central planner. b. a small number of central planners. c. those firms that use resources to provide goods and services. d. the combined actions of millions of households and firms.
Suppose firms in a collusive oligopoly decide to establish their prices at a level that discourages new rivals from entering the industry. This is called:
A. mutual interdependence. B. pricing the demand curve. C. limit pricing. D. price leadership.