If, in response to a decrease in the price of grapes, the quantity of grapes demanded increases, economists would describe this as
A) a change in consumer income. B) an increase in quantity demanded.
C) an increase in consumers' taste for grapes. D) an increase in demand.
B
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The BP curve shifts to the left when:
a. the exchange rate falls. b. interest rates rise. c. income rises. d. imports increase.
If the short-run Phillips curve were stable, which of the following would be unusual?
a. an increase in government spending and a fall in unemployment b. an increase in inflation and a decrease in output c. a decrease in the inflation rate and a rise in the unemployment rate d. a decrease in the money supply and a rise in the unemployment rate.
Answer the following statement(s) true (T) or false (F)
1. In a model that analyzes the effects of a tax change, the tax serves as an endogenous variable. 2. The embarrassment theory suggests why shopping carts should be smaller. 3. An economic model, even if unrealistic, is useful as long as it makes predictions that are realistic. 4. Efficiency is the only criterion by which economists judge policies. 5. All points on a risk-neutral individual's indifference curve have the same expected value.
The main difficulty in applying marginal analysis is
a. calculating total cost b. determining which costs and revenues are relevant to a particular decision c. calculating average cost d. All of the above