Toby sells wheat in a perfectly competitive market. This month Toby receives a lower price for a bushel of wheat than he did last month. Which of the following might explain this?
A. The market demand for wheat increased.
B. The market demand for wheat decreased.
C. Firms exited the market.
D. Toby's costs have increased.
Answer: B
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Elaine owns a beautiful diamond ring she purchased for $2,500. When she has it appraised she learns that it is now worth $3,000. Based on this information:
A. Elaine has experienced a $500 capital gain. B. Elaine's saving this year has increased by $500. C. Elaine's saving this year has decreased by $500. D. Elaine's wealth is unchanged.
For a perfectly competitive firm, as its output increases its marginal revenue ________ and its marginal cost ________
A) changes; changes B) changes; does not change C) does not change; changes D) does not change; does not change
Over the past 40 years, real GDP per capita has roughly
a. stayed the same. b. tripled. c. increased by 50 percent. d. doubled. e. declined by 50 percent.
When the U.S. economy reached full employment in 2007, the cyclically-adjusted deficit that year was -1.3% of GDP. From this information, we know that the:
A. Actual budget deficit must have been very close to 0% of GDP B. Government implemented a contractionary fiscal policy that year C. Actual budget deficit must have been very close to -1.3% of GDP D. Government implemented a more expansionary fiscal policy from 2006 to 2007