Assuming that the demand for a good has decreased and the supply of a good has increased by the same amount, then:
a. The change in price is determinate but the change in quantity is indeterminate.
b. The change in quantity is determinate but the change in price is indeterminate.
c. Neither the change in price nor the change in quantity will be indeterminate.
d. Both the change in price and the change in quantity will be indeterminate.
c
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When the price of a good is lower than the equilibrium price,
a. a surplus will exist. b. buyers desire to purchase more than is produced. c. sellers desire to produce and sell more than buyers wish to purchase. d. quantity supplied exceeds quantity demanded.
Monopolies use their market power to
a. charge prices that equal minimum average total cost. b. increase the quantity sold as they increase price. c. charge a price that is higher than marginal cost. d. dump excess supplies of their product on the market.
When the economy entered a serious recession in 2008, the response of the U.S. government was to institute a $700 billion bailout plan, pursue other heavy deficit spending, and take on unusually large liabilities through bond and money market fund guarantees. This is an example of:
A. procyclical fiscal policy. B. fiscal policy that employs automatic stabilizers as the primary means of economic stabilization. C. sound finance as fiscal policy. D. functional finance and expansionary fiscal policy.
Keynesian theory is based on the hypothesis that
A. saving is influenced primarily by real current disposable income. B. planned savings equal planned investment only at full employment. C. saving is always equal to savings. D. saving is influenced primarily by the interest rate.