An indirect or inverse relationship between price and quantity demanded is
A) the market clearing price.
B) a change in demand.
C) a supply curve.
D) a demand curve.
Answer: D
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An increase in the market interest rate, other things equal, will _____
a. have no effect on investment b. increase the amount invested since the rate of return will be lower c. increase the amount invested because income will increase d. reduce the amount invested because the opportunity costs of investing will be higher e. increase the amount invested because the rate of return will be higher
A balance-of-trade surplus exists
A. if the dollar value of exports exceeds the dollar value of imports. B. if the dollar value of imported capital exceeds the dollar value of exports. C. only if there is relative price inflation domestically. D. only if full employment exists domestically.
The conclusion that oligopoly is inefficient relative to the competitive ideal must be qualified because:
A. industry price leaders often select a price equal to marginal cost. B. over time oligopolistic industries may promote more rapid product development and greater improvement of production techniques than if they were purely competitive. C. increased output due to persuasive advertising may perfectly offset the restriction of output caused by monopoly power. D. many oligopolists sell their products in monopolistically competitive or even purely competitive industries.
Which of the following is a valid counterargument against using tariffs to protect high wages from cheap foreign labor?
A. The benefits of such tariff policy will go to consumers, not workers B. The benefits of such tariff policy will go to businesses, not workers C. Wage rates in a nation are largely determined by productivity, not trade tariffs D. The economy may become overheated, thus increasing inflation