Suppose that the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward. Which of the following could have caused these shifts?
A) Desktop computers are a normal good and incomes increased, while more firms entered the market.
B) The price of a laptop computer, a substitute for desktop computers, fell, and the cost of producing desktop computers decreased.
C) Consumers purchased more computers because of the Christmas season, and the labor costs of producing desktop computers decreased.
D) Desktop computers are a normal good and incomes increased, while the labor costs of producing personal computers increased.
E) Desktop computers are a normal good and incomes decreased, while the labor costs of producing personal computers increased.
D
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Counter cyclical policies ________
A) increase the intensity of economic fluctuations B) lead to hyperinflation C) smooth the rate of growth of the economy over time D) lower output below its potential level
Suppose that Dianne Lindsay spends all her income on two goods, A and B, in a manner in which their marginal utility to price ratios are equal, i.e., MUa/Pa = MUb/Pb. If at that time the price of A is higher than the price of B, then she
a. should increase her consumption of A and decrease her consumption of B because the marginal utility of A is higher b. is already maximizing her total utility and should make no change c. should increase the consumption of B and decrease the consumption of A because the price of B is lower d. should increase the consumption of both A and B since the ratios are equal e. has made an irrational choice
Recall the Application about the marginal cost involved in producing crude oil to answer the following question(s).Recall the Application. If the price of oil is only $15 per barrel, which country is most likely to be selling crude oil?
A. Saudi Arabia B. the United States C. Canada D. Norway
One surprising insight from viewing policy as a "game" is that
A) central bankers should project an image of being conservative on economic policy matters, regardless of their personal views. B) it is more difficult to control inflation when the central bank is highly independent. C) uncertainty over the impact of policy makes little difference in designing an optimal policy. D) money growth has little or no impact on inflation in the long run. E) decreasing money growth may substantially increase the rate of inflation in the long run.