Scientists find that eating corn three times a day will prolong life. This leads to a shift in preferences away from wheat and toward corn. As we move from one equilibrium to another, we can predict that
A. even if they use different technologies, no input markets are affected because they use the same inputs.
B. all input markets except land are affected because both products use land as an input.
C. all input markets are affected.
D. labor markets are not affected because the wheat industry and the corn industry use laborers to drive tractors.
Answer: C
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The relative flexibility of the United States labor market explains why ________ in the United States than in Europe
A) income inequality is greater B) real wages grow more slowly C) unemployment is lower D) all of the above
Suppose that interest rates unexpectedly rise and that FineLine Corporation announces that revenues from last quarter were down but not as much as the public had anticipated they would be down. According to the efficient markets hypothesis, which of the these things make the price of FineLine Corporation Stock fall?
a. both the interest rate rising and the revenue announcement b. neither the interest rate rising nor the revenue announcement c. only the interest rate rising d. only the revenue announcement
For two goods, X and Y, to be classified as substitutes, it must be the case that:
A. consumers tend to purchase both items together. B. when the price of X rises, the demand for Y increases. C. X and Y are identical. D. when the price of X rises, the demand for Y decreases.
How would the desired capital stock be affected by a decline in the user cost of capital?
What will be an ideal response?