Answer the following statements true (T) or false (F)
1. If the newspapers report that there is a shortage of strawberries, it must mean that the current price of strawberries is below the equilibrium price.
2. If there is a surplus in a market, competition among the sellers will drive price down.
3. If we observe that the price of gold is rising and the quantity of gold traded in the market is falling, then this must be the result of an increase in the supply of gold.
4. When the government requires ethanol from corn to be used as an additive to gasoline, the supply of corn decreases.
1. TRUE
2. TRUE
3. FALSE
4. FALSE
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Automobiles imported from Canada or Mexico must have 60% North American content to be eligible for tariff elimination under NAFTA rules. This is an example of:
a. a rules of origin requirement. b. an environmental standard. c. a health and safety requirement. d. a preferential trade agreement.
A period in which the economy is growing at a rate significantly below normal is called a(n):
A. boom. B. expansion. C. recession. D. peak.
If a monopolist is producing at an output rate at which P = ATC, then
A) its economic profit will be zero. B) its economic profit will be positive. C) it is maximizing its profits. D) it is minimizing its losses.
Describe the essential features of the kinked-demand model of oligopoly pricing
What will be an ideal response?