Suppose you observe an increase in the equilibrium price of coffee and a decrease in the equilibrium quantity of coffee. Of the options listed below, this is most consistent with:
A. a decrease in the cost of producing coffee.
B. an increase in consumer income assuming coffee is a normal good.
C. an increase in the cost of producing coffee.
D. a decrease in consumer income assuming coffee is a normal good.
Answer: C
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One effect of inflation is that it is a tax that redistributes goods and services from
A) investors to savers. B) households and businesses to the government. C) businesses to households. D) government to households. E) government to businesses.
Which of the following is a component of the M1 money supply?
A) Mutual funds B) Stock investments C) Three month T-bills D) All of the above are part of M1. E) None of the above is part of M1.
The short-run break-even price is the point at which
A) price is less than marginal cost. B) marginal cost, average total cost and marginal revenue are all equal. C) average variable cost is at a minimum. D) marginal cost, price and average variable cost are all equal.
The output of cell phones can be added to the output of refrigerators in order to compute GDP by:
A.) Multiplying the output of each by the corresponding prices and adding these dollar values. B.) Dividing the output of each by price and adding these dollar values. C.) Adding up the physical number of cell phones and refrigerators produced. D.) Dividing dollar values of output for each by price and adding the results.