Coffee has just been found to increase your expected life span by 5 years if you consume it every day. In the market for coffee, this information will lead to
A. an increase in price and a decrease in quantity.
B. an increase in price and an increase in quantity.
C. a decrease in price and a decrease in quantity.
D. a decrease in price and an increase in quantity.
Answer: B
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Refer to Figure 18.3. Livonia has a comparative advantage in the production of
A) pogo sticks. B) scooters. C) both scooters and pogo sticks. D) neither scooters nor pogo sticks.
Suppose when the price of shoe laces goes from $1 to $2 per pair, production increases from 95 million pairs to 105 million pairs per year. Using the mid-point method, the price elasticity of supply is:
A. 6.28 B. 66 percent C. 10.5 percent D. 0.15
First National Bank (FNB) has a reserve ratio of 20 percent, a required reserve ratio of 10 percent, and deposits of $1,000 . If FNB receives an additional deposit of $100,
a. then it has required reserves of $210 and holds excess reserves of $10. b. then it has required reserves of $10 and holds excess reserves of $20. c. then it has required reserves of $110 and holds excess reserves of $190. d. then it has required reserves of $110 and holds excess reserves of $0.
Which of the following could be used to eliminate potential agricultural shortages?
A. Imposing price ceilings. B. Stimulating export sales. C. Selling the surplus in government stockpiles. D. Acreage set-asides.