Table 14.4In Table 14.4, Market 1 would be in equilibrium if buyers believed lemons accounted for:
A. about 90.91% of the market.
B. about 74.5% of the market.
C. about 63.25% of the market.
D. about 57.65% of the market.
Answer: A
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The Fed wants to keep the dollar at 0.80 euros per dollar. If the demand for dollars increases,
A) the Fed sells dollars to increase the supply of dollars and maintain the exchange rate. B) the Fed conducts persistent intervention on one side of the market. C) the Fed buys dollars to increase the supply of dollars and maintain the exchange rate. D) the Fed buys dollars to decrease the supply of dollars and maintain the exchange rate. E) the Fed sells dollars to decrease the supply of dollars and maintain the exchange rate.
Suppose the market for grass seed is expressed as
Demand: QD = 100 - 2p Supply: QS = 3p Price elasticity of supply is constant at 1. If the supply curve is changed to Q = 8p, price elasticity of supply is still constant at 1. Yet, with the new supply curve, consumers pay a larger share of a specific tax. Why?
If an industry has a price leader, it is most likely to be a dominant firm
a. True b. False Indicate whether the statement is true or false
Expansionary monetary policy involves actions that:
A. reduce the money supply in order to decrease aggregate demand. B. increase the money supply in order to decrease aggregate demand. C. reduce the money supply in order to increase aggregate demand. D. increase the money supply in order to increase aggregate demand.