Assume there are three hardware stores, each willing to sell one standard model hammer in a given time period. House Depot can offer their hammer for a minimum of $7. Lace Hardware can offer the hammer for a minimum of $10. Bob's Hardware store can offer the hammer at a minimum price of $13. Given the scenario described, if the market price of hammers was $10, then:
A. only House Depot would gain surplus by supplying hammers to the market.
B. House Depot, Lace Hardware, and Bob's Hardware would all supply hammers to the market, but Bob's would lose surplus.
C. only House Depot and Lace Hardware would gain surplus by supplying hammers to the market.
D. only House Depot and Bob's Hardware would supply hammers to the market.
Answer: A
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The income effect describes the:
A. decrease in the quantity of labor supplied in response to a lower wage. B. increase in the quantity of labor supplied in response to a higher wage. C. increase in the quantity of labor supplied due to the greater demand for leisure caused by a higher income. D. decrease in the quantity of labor supplied due to the greater demand for leisure caused by a higher income.
First-differenced estimation gives unbiased estimators if the regression model includes a lagged dependent variable.
Answer the following statement true (T) or false (F)
Behavioral economists refer to the first price a consumer hears for a product as the ______.
a. anchor b. endowment c. frame d. marginal utility
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher