Distinguish between a change in quantity supplied and a change in supply
What will be an ideal response?
A change in quantity supplied is a movement along the supply curve caused by a change in the price of the good. An increase in price causes an increase in quantity supplied. A change in any of the other determinants of supply cause a change in supply. When there is a change in supply, the entire supply curve shifts either to the right or to the left.
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Market economies tend to grow more quickly than centrally-planned economies
Indicate whether the statement is true or false
Trade between countries
a. allows each country to consume at a point outside its production possibilities frontier. b. limits a country's ability to produce goods and services on its own. c. must benefit both countries equally; otherwise, trade is not mutually beneficial. d. can best be understood by examining the countries' absolute advantages.
In general, with a monopolist's outcome, total surplus is:
A. the same as that of a competitive market. B. higher than that of a competitive market. C. lower than that of a competitive market. D. Any of these is possible.
Which of the following questions is not answered by general equilibrium analysis?
A. Can all markets simultaneously be in equilibrium? B. Are equilibria in different markets compatible with one another? C. How will a change in one market affect another market? D. What outcome is most desirable for the whole society?