Given a supply curve that is positively sloped and a demand curve for a normal good that is negatively sloped, an increase in income will most likely result in:
A) an increase in price and quantity.
B) a decrease in price and an increase in quantity.
C) a decrease in both price and quantity.
D) an increase in price and a decrease in quantity.
Ans: A) an increase in price and quantity.
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If the exchange rate is 0.8 euro per dollar, one dollar is equal to 1.25 euros
Indicate whether the statement is true or false
Could an increase in urban bus fares eventually lead to an increase in the demand for bus service?
A) It could not do so, though it could lead to a reduction in the demand for bus service. B) It could not do so, though it would probably lead to a reduction in the quantity of bus service demanded. C) It might do so if increasing the demand for and price of downtown parking increased even more. D) It might do so by making the demand for bus service unit elastic. E) Only in cities where the demand for bus service slopes upward to the right.
Ceteris paribus, if negotiations lead to lower wages for airline employees, what will be the result in the market for air travel?
a. an increase in equilibrium price and an increase in equilibrium quantity b. an increase in equilibrium price and a decrease in equilibrium quantity c. a decrease in equilibrium price and an increase in equilibrium quantity d. a decrease in equilibrium price and a decrease in equilibrium quantity
Which of the following will NOT cause a rightward shift in the supply curve?
A) an improvement in technology B) a reduction in resource costs C) a reduction in the expected future price D) none of the above