How would the following events affect the market demand for laser printers?
a) A recession in the economy leading to a fall in income levels
b) A five-fold increase in the price of printing paper
What will be an ideal response?
a) A recession in the economy that causes a fall in income levels will cause a fall in the overall demand in the economy including a fall in the demand for laser printers. This will be represented by a left shift in the demand curve for laser printers.
b) Printing paper and laser printers are complements. Therefore, a fivefold increase in the price of printing paper will make printing more expensive and subsequently reduce the demand for laser printers. This will be represented by a left shift in the market demand for laser printers.
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In the United States there is evidence of:
A. increasing wage inequality. B. an increase in the proportion of the population over 16 employed since 2000. C. an increase in in job creation since 2000. D. increasing wage equality.
Economic freedom is crucial for achieving economic growth because ______.
A. it gives the incentive to save, invest, expand human capital, and discover and apply new technologies B. it ensures that the majority of citizens make the most important decisions C. only good government can make the right investment decisions D. it protects workers' rights and prevents unfair firing E. it upholds democracy, which is essential if an economy is to grow
Refer to Figure 11-12. The movement from isoquant T to isoquant U depicts
A) an increase in the cost of production. B) an increase in output. C) an increase in labor usage holding capital and output constant. D) a change in preferences with regards to input usage.
The vertical classical aggregate supply curve reflects that
a. money wages adjust proportionally with the price level. b. real wages are always the same. c. aggregate output is always the same. d. None of the above. e. Both b and c.