If supply increases and demand decreases, the new equilibrium price will be ________ and the new equilibrium quantity will be ________.
A. lower; lower
B. higher; uncertain
C. lower; uncertain
D. higher; higher
Answer: C
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Government actions to compel more competition in an industry
A) always entail costs, which must be compared to any gains created by the policy. B) always have the effect of lowering prices to consumers. C) cannot benefit anyone if they result in greater inefficiency. D) will result in lower prices but cannot bring about a larger output. E) will not succeed because competition, like morality, cannot be legislated.
In the Cournot model, if the products are differentiated,
A) this reduces the pressure of one firm's decisions on the other. B) this increases the pressure of one firm's decisions on the other. C) there is no difference between this model and one with homogeneous goods. D) marginal costs are necessarily different.
Of the collection of supply and demand diagrams in Figure 2.2, which one shows the result of an increase in the price of an input in the market for anything?
A. Figure 1 B. Figure 2 C. Figure 3 D. Figure 4
Which of the following is true of the short-run aggregate supply curve?
What will be an ideal response?