A leftward shift of the market demand curve for HDTVs, ceteris paribus, causes equilibrium price to
A. Decrease and quantity to increase.
B. Increase and quantity to increase.
C. Increase and quantity to decrease.
D. Decrease and quantity to decrease.
Answer: D
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The fact that most people make some decisions based on intuition rather than calculation is:
A. inconsistent with the cost-benefit model, but still rational. B. consistent with the cost-benefit model because most people intuitively weigh costs and benefits. C. consistent with the cost-benefit model because calculating costs and benefits is irrational. D. irrational, because intuition is usually wrong.
Which of the following statements about a monopoly is FALSE?
A) Monopolies have no barriers to entry or exit. B) The good produced by a monopoly has no close substitutes. C) A monopoly is the only producer of the good. D) None of the above; that is, all of the above answers are true statements about a monopoly.
Jessica owns a company that makes pre-packaged sandwiches for convenience stores. The market price for a sandwich is $5 and Jessica is a price-taker. Her daily cost for making sandwiches is C(Q) = 2.5Q + (Q2/40) and her marginal cost is MC = 2.5 + (Q/20). How many sandwiches should Jessica produce each day?
A. 20 B. 40 C. 45 D. 50
Demand tends to be:
A. more inelastic in the short term than in the long term. B. more elastic in the short term than in the long term. C. equally elastic in the short term and in the long term. D. None of the statements is correct.