If consumers value the product-specific services for a new smartphone at $25, if retailers offer the product-specific services for the smartphone, the market ________ will ________.
A) supply; parallel shift to the right by $25
B) demand; parallel shift to the right by $25
C) demand; parallel shift to the left by $25
D) demand; parallel shift to the right by less than $25
B) demand; parallel shift to the right by $25
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If the Fed wants to permanently lower interest rates, then it should raise the rate of money growth if
A) there is fast adjustment of expected inflation. B) there is slow adjustment of expected inflation. C) the liquidity effect is smaller than the expected inflation effect. D) the liquidity effect is larger than the other effects.
Unions sometimes try to ensure that employers hire more union labor than they might otherwise prefer by
a. collective bargaining b. featherbedding c. work enlargement d. restricting the supply of labor e. increasing the demand for union-made products
If the government removes a binding price ceiling from a market, then the price received by sellers will
a. decrease, and the quantity sold in the market will decrease. b. decrease, and the quantity sold in the market will increase. c. increase, and the quantity sold in the market will decrease. d. increase, and the quantity sold in the market will increase.
A company producing sports equipment wishes to increase its total revenue. Should it increase or decrease its price when the product's price elasticity of demand is equal to -0.8?
(a) Increase - the good is price inelastic and in order to increase TR the firm should increase its price. (b) Decrease - the good is price elastic and in order to increase TR the firm should decrease its price. (c) Increase - the good is price elastic and in order to increase TR the firm should increase its price. (d) Decrease - the good is price inelastic and in order to increase TR the firm should decrease its price.