Explain what will happen to the equilibrium price and quantity of satellite TV service if the wages of the workers who provide the satellite TV service increase while at the same time the price of cable television service (a substitute for satellite
TV service) also increases.
The wage increases will cause supply to decrease and increases in the price of cable television service will cause demand for satellite TV service to increase. Equilibrium price will definitely increase. Equilibrium quantity will depend on whether the decrease in supply or the increase in demand is larger. If the supply decrease is larger than the demand increase, equilibrium quantity will decrease. If the demand increase is larger than the supply decrease, equilibrium quantity will increase.
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The figure above shows the supply curve for soda. The market price is $1.00 per soda. The producer surplus from the 10,000th soda is
A) $0.00. B) $0.50. C) $1.00. D) more than $1.00. E) None of the above answers is correct.
Some people support the Euro in hopes that the European Central Bank will emulate the monetary policy of the central bank of
A) Germany. B) France. C) Italy. D) Spain.
Refer to Scenario 5.10. Hillary's indifference curves showing her preferences toward risk and return can be shown in a diagram. Expected return is plotted on the vertical axis and standard deviation of return on the horizontal axis
Although her indifference curves are upward sloping and bowed downward, their slope is very gradual (they are almost horizontal). These indifference curves reveal that Hillary is: A) risk neutral. B) risk averse. C) risk loving. D) irrational.
In peak-load pricing, the off-peak profit-maximizing quantity is ________ than the profit-maximizing quantity during the peak period and the profit-maximizing price during the off-peak period is ________ than the profit-maximizing price during the peak period.
A) less; more B) more; more C) less; less D) more; less