The market demand curve:
A. shows the relationship between the price of a good and the quantity that all consumers together are willing to buy.
B. is drawn assuming that variables such as income and tastes are variable.
C. is drawn assuming that the number of consumers is variable.
D. is drawn assuming that the selling price is fixed.
Answer: A
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Uncertainty costs arise from inflation because inflation makes long-term planning ________ so people respond by ________ investment
A) less difficult; not changing B) less difficult; increasing C) more difficult; increasing D) more difficult; decreasing E) more difficult; not changing
Ceteris paribus, which of the following is most likely to cause an increase in the quantity supplied of perfume?
A. An increase in the salaries paid to perfume makers. B. An increase in the price of perfume. C. An improvement in perfume-making technology. D. An increase in the number of sellers of perfume.
Monopolistic competition entails a deadweight loss to society, even if the firms earn zero economic profits.
Indicate whether the statement is true or false.
Which firm in Figure 26.5 is producing at the output level that maximizes production efficiency?
A. Firms A and C only. B. Firms B and D only. C. Firm B only. D. Firm A only.