If the price of cotton increases
a. consumers will buy more cotton clothes.
b. consumers will increase their purchases of clothing made of other materials.
c. clothing producers will stop making cotton clothes.
d. clothing producers will not be able to adjust their output.
B
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Suppose the firms in a perfectly competitive industry are earning positive economic profits
How will these positive profits affect the flow of resources into the industry? How will the equilibrium quantity and price change in the industry because of the profits?
Can the incidence of a sales tax ever be so that buyers pay all of the tax or so that sellers pay all of the tax?
What will be an ideal response?
The most likely substitute good for hot dogs would be:
A. ketchup. B. burgers. C. potato chips. D. a plate.
If the marginal propensity to save (MPS) is 0.25, the simple multiplier is _____
a. 25 b. 75 c. 5 d. 3/4 e. 4