?
According to Figure 5-13, if the price of good X falls, the optimal combination will move
A. from U1to a point on a higher indifference curve, such as U3.
B. from U2to a point on a higher indifference curve, such as U3.
C. from U1to a point on a higher indifference curve, such as U3.
D. from U2to a point on a higher indifference curve, such as U1.
Answer: B
You might also like to view...
________ choose(s) the quantities of goods and services to produce, while ________ choose(s) the quantities of goods and services to buy
A) Firms; only households B) Households; the government C) Households; firms D) Firms; households and the government E) The government; firms
In practice, the Board of Governors and FOMC typically defer to the policy proposals of the:
A) President B) Chair of the Fed C) Secretary of Treasury D) Speaker of the House
Monopolistic competition is similar to perfect competition in that:
A. firms earn economic profits in the long run B. there are a large number of firms C. firms face downward-sloping demand curves D. both a and b E. all of the above
In a competitive market illustrated by the diagram below, a price ceiling of $10 per unit will result in:
A. A shortage of 200 units
B. A surplus of 200 units
C. A surplus of 250 units
D. A shortage of 250 units