Consider the market for ride-on lawn mowers and the recent increases in the price of oil. The recent increase in the price of oil makes it more expensive to manufacture ride-on lawn mowers. An increase in the price of oil also makes it more expensive to run a ride-on mower. What factors of demand and/or supply are affected by the changing price of oil?
A. Price of related good, price of input
B. Price of input, number of buyers
C. Price of related good, expectations of future
D. Price of input, income
Answer: A
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Which of the following mergers would result from the purchase of a paper mill by a textbook publishing company?
a. An interlocking merger. b. A vertical merger. c. A conglomerate merger. d. A horizontal merger.
Which of the following is an example of an adverse selection problem?
a. A customer purchases four apples, two of which are bruised. b. A card shop puts its Halloween merchandise on sale on November 1st. c. A young job applicant fails to reveal that she was fired from her last job because she was incompetent. d. A man rents a car and then drives it less carefully and fills it with cheaper gas than he would if he owned it.
If firms are producing below capacity,
a) it is not possible to increase output b) they will charge higher prices to maintain profit levels c) resources, especially labor, are in short supply d) output can be expanded by hiring extra workers e) an increase in aggregate demand will force firms into bankruptcy
A union's success in raising the wage depends on
A) the elasticity of demand it faces. B) members' ability to act collectively. C) the share of the labor market that is unionized. D) All of the above.