Suppose the market clearing price for apples rises from $2.00 to $3.00 per pound, and the overall market clearing output increases from 1 million to 2 million pounds. How can we explain the increase in price and increase in market output?
A) Supply increased and demand remained unchanged.
B) Supply decreased and demand decreased.
C) Demand increased and supply remained unchanged.
D) None of the above.
C
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
A deliberate change in the government's deficit
A) constitutes discretionary fiscal policy. B) leads to automatic stabilization. C) acts as a drag on the economy. D) is implemented by the Fed.
Which one of the following is an example of a normative statement?
A) A vacation in Colorado is better than a vacation in Hawaii. B) Hotels in Colorado are more expensive than are hotels in Hawaii. C) The hotel vacancy rate in Hawaii will increase as airfares to Hawaii increase. D) The busiest tourist month in Colorado is July.
The majority of countries in the world have some type of fixed exchange rate system
Indicate whether the statement is true or false