The following changes in a consumer's economic circumstances result in a steeper budget line with the vertical intercept unchanged. (Denote the good on the horizontal as good 1 and the good on the vertical as good 2.)
A. A k percent decrease in the price of good 2 combined with a k percent decrease in income
B. A k percent increase in the price of good 2 combined with a k percent decrease in income
C. A k percent decrease in the price of good 2 combined with a k percent increase in income
D. A k percent increase in the price of good 2 combined with a k percent increase in income.
E. None of the above
Answer: A
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Agreeing to iron your roommates shirts while she types up the paper you have written is an example of which of the following:
a. Barter b. Opportunity Cost c. Sunk Cost d. Absolute Advantage
If the price of a good decreases while the quantity of the good exchanged on markets increases, then the most likely explanation is that there has been
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A firm that is a price taker can:
A. substantially change the market price of its product by changing its level of production. B. sell all of its output at the market price. C. sell some of its output at a price higher than the market price. D. decide what price to charge for its product.