The financial and opportunity costs consumers pay when looking for a good or service:
a. supply shock
b. shortage
c. excess supply
d. disequilibrium
e. search costs
Ans: e. search costs
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The price of a first-class stamp in 1957 was 3 cents, and it is 49 cents in 2014. From this we know that
A) both the relative and the absolute price of first-class stamps increased from 1957 to 2014. B) the money price of first-class stamps increased from 1957 to 2014 but the absolute price of first-class stamps stayed constant. C) the money price of first-class stamps increased from 1957 to 2014 and the relative price of first-class stamps decreased. D) the money price of first-class stamps increased from 1957 to 2014, but we can't tell if the relative price of first-class stamps increased or decreased without more information.
A decrease in the price of spaghetti is likely to cause:
A. a movement to the right along the demand curve for spaghetti. B. an inward shift of the demand curve for spaghetti. C. an outward shift of the demand curve for spaghetti. D. a movement to the left along the demand curve for spaghetti.
The formula for AVC is
A. ?TVC/?q. B. q/TVC. C. TVC/q. D. ?q/?TVC.
Related to the Economics in Practice on page 292: The smart phone industry is best characterized as
A. an oligopoly. B. a monopoly. C. monopolistically competitive. D. purely competitive.