A price floor of $23 placed on the market in the graph shown:
A. is non-binding, and does not affect the market.
B. is binding, and causes a surplus.
C. is binding, and causes a shortage.
D. is non-binding, and does not prevent the market from reaching equilibrium.
Answer: B
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On a production possibilities frontier diagram, where are production points that have tradeoffs? Where are production points with a free lunch?
What will be an ideal response?
Which statement is true about labor unions in the United States?
A. Overall unions have had no effect on wages, but have created better working conditions. B. They did not gain widespread acceptance until the 1920s. C. The U.S. has virtually the same percentage of its workforce unionized as other industrial nations. D. None of the choices are true of labor unions in the U.S.
With respect to the market clearing price and the equilibrium quantity for good X, an increase in the demand for and a decrease in supply of the good definitely will
A) increase the market clearing price and the equilibrium quantity of good X. B) decrease the market clearing price and the equilibrium quantity of good X. C) increase the market clearing price of good X but lower the equilibrium quantity of X. D) increase the market clearing price of good X but have an uncertain impact on the equilibrium quantity of X.
Without an accepted medium of exchange, people
A. have to specialize in one area of production. B. have to rely on barter in order to exchange goods and services. C. have to use credit to obtain goods and services. D. have to rely on gold or silver in order to exchange goods and services.