If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices.
B. lower level of output and prices.
C. higher level of output and prices.
D. lower level of output at higher prices.
Answer: A
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The Friedman-Savage utility function can explain why
A) people buy automobile insurance. B) somebody becomes addicted to gambling. C) people become more risk averse as their wealth increases. D) people place small bets to have a chance at winning a large amount.
When a market is in disequilibrium, such as when the quantity supplied of a good is greater than the quantity demanded of that good, the price of the good will rise, ceteris paribus
Indicate whether the statement is true or false
Suppose that a firm maximizes its profits by producing a quantity of 20 units. The market price is $5. The firm's variable costs are $70 and its fixed costs are $40. What should the firm do in the short run? In the long run?
What will be an ideal response?
A person who chooses ________ the labor force reveals that either leisure or the value of nonpaid labor is worth ________ to him or her than the value that society places on his or her potential product in the market.
A. to stay in; more B. not to be in; more C. to enter; more D. to exit; less