A decrease in supply will have what effect on equilibrium price and quantity?
A. Price will increase; quantity will decrease.
B. Price will decrease; quantity will increase.
C. Both price and quantity will increase.
D. Both price and quantity will decrease.
Answer: A
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A firm is concerned about the possibility of patent infringement and has hired an attorney to review patents. If the attorney is reviewing 100 patents and the marginal cost of reviewing the 100th patent is $40 and the expected marginal benefit of reviewing the 100th patent is $45, which of the following is true?
A) The firm's total cost of infringement will decrease if the number of patents reviewed decreases. B) The firm is minimizing the total cost of infringement. C) The firm's total cost of infringement will increase if the number of patents reviewed increases. D) The firm's total cost of infringement will decrease if the number of patents reviewed increases.
In a modern dynamic economy such as the United States, full employment generally means
a. cyclical unemployment is present. b. everyone (excluding teenagers) that would like to work is employed. c. approximately 95 percent of the labor force is employed. d. 100 percent of the labor force is either working or seeking work.
If a recessionary GDP gap exists, which of the following sets of policies should the Federal Reserve Board pursue?
A. Sell government securities, lower the discount rate, and lower the required reserve ratio. B. Sell government securities, lower the discount rate, and raise the required reserve ratio. C. Buy government securities, raise the discount rate, and lower the required reserve ratio. D. Buy government securities, lower the discount rate, and lower the required reserve ratio.
Business fluctuations
A. have no influence on inflation and unemployment. B. can influence inflation and unemployment. C. influence inflation but not unemployment. D. influence unemployment but not inflation.