In the Case in Point on "The Monks of St. Benedict's," the Monks got out of the egg business largely because:
A) there was a large increase in the supply of eggs from other producers.
B) of the increase in the price of chicken feed.
C) the Pope forbade them from working on Sunday.
D) a huge increase in the demand for eggs caused the price of eggs to increase, and their operation was too small to meet the demand.
Ans: B) of the increase in the price of chicken feed.
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If the level of autonomous spending in an economy increases at a given price level, _____
a. the aggregate expenditure line shifts upward and the economy moves upward along the aggregate demand curve b. the aggregate expenditure line shifts downward and the economy moves upward along the aggregate demand curve c. the aggregate expenditure line shifts upward and the aggregate demand curve shifts to the right d. the aggregate expenditure line shifts downward and the aggregate demand curve shifts to the left e. the aggregate expenditure curve shifts upward and the aggregate demand curve shifts to the left
When Alfred Marshall, the celebrated 19th-century economist, used the scissors metaphor to explain how prices are determined, he
a. expressed the view that the sharpness of entrepreneurs keeps prices low b. expressed the view that the sharpness of competition keeps prices low c. pointed out that both blades do the cutting just as the interaction of supply and demand determine equilibrium price d. showed that price and quantity were the equivalents of the scissor's two blades e. showed that producers and consumers were at the cutting edge of price determination
Which of the following is NOT a characteristic of a typical indifference curve?
A. The curve shows all combinations of goods that give the consumer the same level of utility. B. The curve will shift out if income increases. C. As a consumer has less of a good, he is less willing to exchange less of it for one more unit of another good. D. The marginal rate of substitution is measured by the slope of the tangent to the curve.
Over a period of time, a nation's GDP increases by 8 percent in constant-price terms, and by 6 percent in current-price terms. Other things being equal, the price level must have changed by about:
A. 14 percent B. 4 percent C. 2 percent D. -2 percent