Comparative statics involves
a. the application of principles of physics to economic analysis.
b. the process of studying how equilibria change in response to changes in exogenous variables.
c. the process of studying how exogenous variables change.
d. comparing two uncertain states of the world.
b. the process of studying how equilibria change in response to changes in exogenous variables.
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Suppose that Carol owns a property with a mineral spring. It costs zero for Carol to sell water to customers since buyers come to her property and bring their own bottles and fill them themselves. If Carol wants to maximize her profits from the sale of her mineral water, she should choose the output level
A. where the demand curve for water hits the vertical axis. B. where demand is inelastic. C. where demand is unit elastic. D. demand is exhausted.
The type of advertising used for an experience good is
A) informational advertising. B) persuasive advertising. C) search advertising. D) experience advertising.
Which of the following would shift the short-run Phillips curve to the left?
a. a positive supply shock b. an increase in inflationary expectations c. an negative supply shock d. either (a) or (c)
The existence of a universal law of scarcity creates pressures on societies to
a. use their resources according to government plans. b. economize in the use of their resources. c. allocate their resources equitably. d. exploit their resources.