Which of the following is true for the law of supply?
A. Buyers decrease the quantity of a good purchased as price increases.
B. Sellers increase the quantity of a good supplied as price increases.
C. Price decreases as more units are supplied.
D. A decrease in price results from more demand.
Ans: B. Sellers increase the quantity of a good supplied as price increases.
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Which of the following will raise the expected marginal product of capital?
A) a reduction in the interest rate B) increased business optimism C) an investment tax credit D) a reduction in the corporate profits tax
If the merger of two firms is challenged by an antitrust agency, one possible solution is for the firms to ________.
A) sell some of their assets to a third firm to avoid reducing competition. B) include more than three firms in the merger. C) include a third firm in the merger. D) sell their assets to each other to avoid reducing competition.
The market system communicates changes in market conditions and elicits appropriate responses from businesses and resource suppliers through changes in prices. This is known as the:
A. Guiding function of prices B. Monetary function of prices C. Circular flow of income D. Market determination of prices
The problem of the cartel points out that
A. the interests of consumers and duopolists conflict. B. the interests of consumers and duopolists are the same. C. the interests of consumers and duopolists are the same in output management, but conflict in pricing. D. the interests of consumers and duopolists are the same in pricing, but conflict in output management.