If the price of muffins, a normal good you enjoy, rises, then
A) both the income and substitution effects lead you to buy fewer muffins.
B) the substitution effect which causes you to decrease your muffin consumption outweighs the income effect which causes you to increase your muffin consumption, resulting in fewer muffins purchased.
C) the income effect which causes you to decrease your muffin consumption outweighs the substitution effect which causes you to increase your muffin consumption, resulting in fewer muffins purchased.
D) the income and substitution effects offset each other but the price effect leads you to buy fewer muffins.
A
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Which of the following is determined using the rule-of-reason analysis?
A) output restrictions B) resale price maintenance C) bid rigging D) market division
The term "double coincidence of wants" is necessary for _________ to take place.
Fill in the blank(s) with the appropriate word(s).
The World Trade Organization (WTO)
a. members are required to eliminate tariffs and customs duties b. supervises trade in merchandise and in services c. supervises merchandise trade only d. members are required to eliminate ad valorem tariffs but not specific tariffs e. includes all nations with populations greater than 10 million, with the exception of North Korea and Cuba
In many cities, the price of summer pops concerts has risen. In Charlotte, North Carolina, and Columbus, Ohio, for example, concerts that were once free now cost $5. If there are only fixed costs and no variable costs nor marginal costs in an orchestra concert, what is the efficient price? Explain the reason why some people will find the efficient price unfair.
What will be an ideal response?