A newspaper reports that in an urban area the average price of new homes had decreased, but the number of new homes sold had increased. This situation would best be explained by a(n):
a. Increase in supply
b. Decrease in demand
c. Increase in demand
d. Decrease in supply
Ans: a. Increase in supply
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Deadweight loss from the imposition of a price floor increases as consumer demand becomes more price elastic.
Answer the following statement true (T) or false (F)
Everything else held constant, in the market for reserves, when the demand for federal funds intersects the reserve supply curve along the horizontal section, increasing the discount rate
A) increases the federal funds rate. B) lowers the federal funds rate. C) has no effect on the federal funds rate. D) has an indeterminate effect on the federal funds rate.
When considering different investments, a risk-averse investor is most likely to focus on purchasing:
A. investments that offer the lowest standard deviation in the investments' expected rates of return for any given expected rate of return. B. investments with the lowest risk premium, regardless of the expected rate of return. C. investments with the greatest spread in the expected rate of return. D. only risk-free investments.
Refer to the short-run information provided in Figure 8.5 below to answer the question(s) that follow. 
Figure 8.5 Refer to Figure 8.5. If four drones are produced, total variable costs are
A. $17.50. B. $20. C. $70. D. $120.