According to the law of demand, what happens when prices go down?
a. Demand increases.
b. Quantity demanded increases.
c. Demand decreases.
d. Quantity demanded decreases.
Ans: b. Quantity demanded increases.
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In the long run in a competitive market,
a. existing firms can increase their plant size, and new firms can enter the market b. existing firms can increase their plant size, but the number of firms is the market is fixed c. new firms can enter the market, but existing firms cannot vary their plant size d. new firms can enter the market, but only if existing firms decrease their plant size in the short run e. existing firms can increase their plant size, only if some other firms exit
Because technology has automated so many functions, personal services have become cheaper in order to compete
a. True b. False Indicate whether the statement is true or false
Because saving is a leakage, sudden additional saving results in higher equilibrium income for society, ceteris paribus.
Answer the following statement true (T) or false (F)
Refer to the information provided in Figure 3.18 below to answer the question(s) that follow.
Figure 3.18Refer to Figure 3.18. The market is initially in equilibrium at Point B. If demand shifts from D2 to D1 and there is an excess supply of 200 million pounds of burritos, the price of burritos would be
A. $1.50. B. $3.00. C. $4.00. D. $6.00.