When supply increases and at the same time demand decreases, we
A) can predict that both equilibrium price and quantity will increase.
B) can predict that both equilibrium price and quantity will decrease.
C) cannot predict equilibrium quantity, but know that equilibrium price will decrease.
D) cannot predict the change in either the equilibrium quantity or equilibrium price.
Answer: C
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For a regulated natural monopoly, an average cost pricing rule sets price equal to
A) average fixed cost. B) average total cost. C) average external cost. D) average variable cost.
Under the Bretton Woods system, an asymmetry in the ability of central banks to defend their exchange rates existed because
A) a country experiencing a balance of payments surplus was limited in its ability to defend its exchange rate by its stock of international reserves. B) a country experiencing a balance of payments deficit was limited in its ability to defend its exchange rate by its stock of international reserves. C) central banks were allowed by the IMF to adjust their exchange rates upward whenever they chose, but were rarely allowed to adjust their exchange rates downward. D) central banks were allowed by the IMF to adjust their exchange rates downward whenever they chose, but were rarely allowed to adjust their exchange rates upward.
Monetarists believe that the private sector of our economy is inherently ______.
Fill in the blank(s) with the appropriate word(s).
Back-loading of employees' wages helps a company because:
a. they act as incentives for employees to work hard throughout their tenure with the company. b. they completely eliminate all sorts of opportunistic behavior on the part of the employee throughout his/her tenure with the company. c. they reduce the actual cost burden of the employee on the company. d. they prevent opportunistic behavior on the employer's part.