Assume declining profits in the market for Internet service force several firms in the area to drop out of the market. All else constant, this would cause the:
A) equilibrium price and quantity to decrease.
B) equilibrium price and quantity to increase.
C) equilibrium price to increase and equilibrium quantity to decrease.
D) equilibrium price to decrease and equilibrium quantity to increase.
C
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Which of the following countries has a long history of foreign trade and a high level of trade?
a. Brazil b. India c. Sweden d. United States
Which account of the balance of payments is most likely to be directly affected by a rise in the real risk-free interest rate in a foreign country?
a. Current international transactions b. Net nonreserve-related international borrowing/lending c. Official reserve-related (central bank) transactions d. None.
Which of the following is not a typical justification for running a budget deficit?
a. financing a war b. dealing with a recession c. fighting inflation d. dealing with unemployment
For normal goods
A. the substitution effect of a price decrease will decrease the quantity of the good demanded while the income effect of a price decrease will increase the quantity of the good demanded. B. the substitution and income effects of a price decrease will both increase the quantity of the good demanded. C. the substitution effect of a price decrease will increase the quantity of the good demanded while the income effect of a price decrease will decrease the quantity of the good demanded. D. the substitution and income effects of a price decrease will both decrease the quantity of the good demanded.