After a hurricane in Florida knocked out the regional water supply for several days, the demand for bottled water increased sharply. In a market economy, how will this increase in demand affect the equilibrium price and quantity of bottled water?
a. Price will increase, and quantity will decrease.
b. Price will decrease, and quantity will decrease.
c. Price will decrease, and quantity will increase.
d. Price will increase, and quantity will increase.
d
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If the Federal Reserve lowers the required reserve ratio, people will end up taking out ________ because the interest rates ________
A) more loans; will rise B) the same number of loans; will not change C) more loans; will fall D) fewer loans; will rise E) fewer loans; are controlled by the economic conditions alone
If a product has zero external costs, then marginal social cost equal marginal private cost
Indicate whether the statement is true or false
Suppose there is an increase in autonomous consumption. Specifically, suppose c0 increases where C = c0 + c1YD. This increase in autonomous consumption will cause which of the following to increase?
A) equilibrium income B) equilibrium disposable income C) demand D) all of the above E) none of the above
Suppose prices are quoted in dollars and transactions are conducted in pesos. The peso serves as a
A) medium of exchange. B) store of value. C) unit of account. D) all of the above.