If price is above the equilibrium price, then there will be:
A. neither excess supply nor excess demand.
B. excess demand.
C. both excess supply and excess demand.
D. excess supply.
Answer: D
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One of the most obvious clues to the relative scarcity of a product is
A) the limited selection of colors. B) the quality of the product. C) the variations in available sizes. D) its current market price.
An example of a one-time expense for a shoe factory would be buying:
A. a sewing machine, and would be included in total cost. B. a sewing machine, and would be excluded from total cost. C. leather to make the shoes, and would be included in total cost. D. leather to make the shoes, and would be excluded from total cost.
The argument that concentration of market power enhances research and development efforts may be weak because:
A.) Monopolies cannot afford basic research. B.) No one has attempted to gather any empirical evidence. C.) A monopoly may have no clear incentive to pursue new research and development. D.) No existing monopoly has a research and development program.
The Heckscher-Ohlin theory predicts that the opening of trade between a land-abundant country and a labor-abundant country should result in
A. higher wages in the labor-abundant country and higher rents in the land-abundant country. B. higher rents and wages in both countries. C. lower rents and wages in both countries. D. higher rents in the labor-abundant country and higher wages in the land-abundant country.