In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X. An increase in the tastes and preferences for X will:
A. decrease S, decrease P, and decrease Q.
B. decrease D, decrease P, and decrease Q.
C. increase D, increase P, and increase Q.
D. increase S, decrease P, and increase Q.
Answer: C
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On a production possibilities frontier diagram, where are production points that have tradeoffs? Where are production points with a free lunch?
What will be an ideal response?
In a sole proprietorship
a. only one product can be offered for sale b. only family members can be employed in the business c. the business cannot expand unless it becomes a partnership d. one person owns the business e. stock can be issued to raise money for the business
Cole was discussing the market for cocoa beans with his friend John Schmidt. Cole said, "Ever since Venezuela announced that its cocoa harvest was its lowest ever in fifteen years, the price of cocoa beans has been rising and rising and people are buying
more and more. I think the demand for cocoa beans must be upward sloping." Is Cole right? Briefly explain why or why not. What will be an ideal response?
Using the figure above, suppose education is provided by public colleges, where tuition is set at $10,000 a year. Then, ________ million students are enrolled, and the taxpayers cover ________ of marginal cost per student
A) 15; $15,000 B) 7.5; $5,000 C) 3.5; none D) 15; $25,000 E) 7.5; $15,000