If the price of a normal good falls, the income effect will result in households buying ________ of the good and the substitution effect will result in households buying ________ of the good.
A. more; more
B. more; less
C. less; more
D. less; less
Answer: A
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The long-run aggregate supply curve is ________ because along it, as prices rise, the money wage rate ________
A) vertical; falls B) vertical; rises C) upward sloping; falls D) upward sloping; stays constant
Which of the following is best characterized as being nonrivalrous?
A) consumption goods B) services C) physical capital D) knowledge
An increase in the price of a product and an increase in the number of sellers in the market affect the supply curve in the same general way
a. True b. False Indicate whether the statement is true or false
Suppose Iran imposes a tariff on lumber. For the tariff to have any effect, it must be the case that
a. Iran is an exporter of lumber. b. the domestic quantity of lumber supplied exceeds the domestic quantity of lumber demanded at the world price without the tariff. c. the world price without the tariff is less than the price of lumber without trade. d. the world price without the tariff is greater than the price of lumber without trade.