The more closely substitutable are two goods, the
A) more normal looking is the indifference curve for the two items.
B) more closely the indifference curve for these two items approximates a straight line.
C) more tightly curved is the indifference curve for these items.
D) None of the above answers is correct.
B
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The effect of a change in price on the quantity bought while keeping the consumer on the same indifference curve, is called the
A) price effect. B) income effect. C) substitution effect. D) real effect.
Unexpected discoveries of mineral reserves will ordinarily cause the price of these minerals to increase
a. True b. False Indicate whether the statement is true or false
Suppose that demand for a good decreases and, at the same time, supply of the good decreases. What would happen in the market for the good?
a. Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous. b. Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous. c. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. d. Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.
An increase in the demand for a good is represented by:
A) a leftward movement along the demand curve. B) a rightward movement along the demand curve. C) a left shift to a new demand curve. D) a right shift to a new demand curve.