Society might argue that there are cases in which it is appropriate to resist price increases in situations where scarcity is serious. Included would be the case of
A. unrestrained monopoly that would otherwise succeed in extracting funds from the public.
B. taxes imposed on products capriciously and inappropriately.
C. rising prices falling so heavily on the poor that rationing becomes preferable.
D. All of the responses are correct.
Answer: D
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Consider the market for credit. When the demand for credit decreases while the supply of credit remains unchanged,
A) the interest rate will decrease and the amount of credit provided in the market will increase. B) the interest rate will increase and the amount of credit provided in the market will increase. C) the interest rate will decrease and the amount of credit provided in the market will decrease. D) the interest rate will increase and the amount of credit provided in the market will decrease.
Velcro is becoming more and more popular for a variety of uses, including as fasteners for shoes. What should happen to the equilibrium price and quantity for shoelaces as a result?
a. Both price and quantity should increase. b. Both price and quantity should decrease. c. Price should increase and quantity decrease. d. Price should decrease and quantity increase. e. Nothing.
Which of the following statements concerning the First Bank of the United States is not true?
a. Its goal was to prevent state-chartered banks from overissuing bank notes. b. Its charter lasted 20 years. c. It was the first version of a central bank in the United States. d. It served as the government's fiscal agent. e. It was the first bank chartered in the United States.
How will a cut in a fixed tax affect the consumption schedule?
a. It will shift downward. b. It will shift upward. c. It will become flatter. d. It will become steeper.