Which of the following events would cause a rightward shift in the market supply curve for automobiles?
A. A technological improvement that reduces the cost of production.
B. A higher sales tax on automobiles.
C. An increase in the wages of autoworkers.
D. A decrease in the number of sellers.
Answer: A
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Of the collection of supply and demand diagrams in Figure 2.2, which one shows the result of a decrease in the taste for a good?
A. Figure 1 B. Figure 2 C. Figure 3 D. Figure 4
The Federal reserves Open Market Committee currently meets:
A. monthly. B. bi-weekly. C. once every quarter, unless a crisis warrants more frequent meetings. D. eight times a year.
Suppose expected inflation in the economy is 5%. Banks set nominal interest rates so they'll earn a 2% expected real return. Employers set nominal wages based on a 2% expected real wage increase. Suppose the nominal interest rate and nominal wages are determined this way, but actual inflation turns out to differ from the expected inflation rate. Calculate the actual real interest rate and the percent increase in the real wage for each of the following actual inflation rates: a) 2%; b) 5%; c) 10%.
What will be an ideal response?
The major beneficiaries from the elimination of a tariff on a product are the:
A. Foreign consumers of the product B. Domestic producers of the product C. Domestic consumers of the product D. Domestic workers in industries producing the product