Suppose a market were currently at equilibrium. A rightward shift of the demand curve would cause
A) an increase in price but a decrease in quantity.
B) a decrease in price but an increase in quantity.
C) an increase in both price and quantity.
D) a decrease in both price and quantity.
C
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If the endowment allocation in an Edgeworth Box is efficient, then this allocation is also the competitive equilibrium allocation.
Answer the following statement true (T) or false (F)
The opportunity cost of taking an on-line history class is
A) the cost of tuition and fees only. B) zero because there is no classroom time involved if you are enrolled in the course. C) the value of the time spent on line. D) the knowledge and enjoyment you receive from taking the class. E) equal to the highest value of an alternative use of the time and money spent on the class.
Producer surplus:
a. measures the value between the actual selling price of a product and the price at which sellers are willing to sell the product. b. is illustrated by the area above the supply curve and below the market price. c. is maximized in market equilibrium. d. all of these.
As disposable income decreases, consumption
A. and saving both increase. B. decreases and saving increases. C. and saving both decrease. D. increases and saving decreases.