Assume that coal is a normal good. If the price of coal increases and the quantity sold increases, which of the following is consistent with these observations?
A. The price of oil increased, oil and coal being substitutes
B. A wage increase was give to coal miners
C. New machinery made coal mining more efficient
D. Consumers' incomes fell
E. The demand curve is inelastic
A. The price of oil increased, oil and coal being substitutes
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If Dana can paint his house faster than Luke, a professional house painter, then:
a. Dana has a comparative advantage in house painting. b. Dana has an absolute advantage in house painting. c. Luke has a comparative advantage in house painting. d. Luke has an absolute advantage in house painting. e. Dana should always paint his own house.
If the government wished to shift aggregate demand to the left, it might:
A. decrease military spending. B. increase the amount of educational grants available. C. decrease corporate income taxes. D. All of these would cause a decrease in aggregate demand.
One method of addressing an excess demand in a market that is created by a price ceiling is to
a. decrease price b. ration the good c. create a price floor d. decrease supply e. have the government buy up the surplus
Informal liquidation is also known as
a. assignment b. bankruptcy c. reorganization d. removal of assets e. selling the business