"The hotter it gets, the more water people drink." This statement implies that the relationship between temperature and water consumption must have:
a. no relationship
b. a negative slope.
c. a positive slope.
d. either positive or negative slope.
c
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A decrease in aggregate demand results in a(n) ________ in the ________
A) expansion; long run B) recession; short run C) expansion; short run D) recession; long run
If demand increases while supply simultaneously decreases, then the equilibrium quantity
A) always increases. B) always decreases. C) can never change. D) none of the above
The Department of Justice has challenged the merger of two firms, and the case has ended up in the Supreme Court. The two firms argue that they will not use their monopoly power to raise prices or to cut output. Under what judicial standard would their merger be allowed, and under what judicial standard would their merger be disallowed?
A Hicksian, or compensated, demand curve reflects:
A. only the substitution effect of a price change. B. only the income effect of a price change. C. both the income and substitution effects of a price change. D. neither the income nor the substitution effects of a price change.