If the price of aluminum used to make bicycles increases, the price of a bicycle rises because of a
A) rightward shift of the demand curve for bicycles.
B) rightward shift of the supply curve of bicycles.
C) leftward shift of the demand curve for bicycles.
D) leftward shift of the supply curve of bicycles.
D
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Using the government as a means of redistribution generates equity at the cost of efficiency, in part because
A) the process of redistribution uses up some of society's resources. B) the process of redistribution creates new resources for society. C) redistribution creates new incentives to work for both rich and poor. D) redistribution would not take place otherwise.
Behavioral economists think that the less obvious a person's opportunity cost is:
A. the harder it is to value accurately. B. the more likely they will undervalue it. C. the less likely they are to correctly value it. D. All of these are true.
If the production possibilities curve in France is bowed out and the curve in Spain is a straight line, then we know that
a. no trade can take place between France and Spain b. the terms of trade will always be in favor of France c. the terms of trade will always be in favor of Spain d. the law of increasing costs apply to France but not to Spain e. the law of increasing costs apply to Spain but not to France f. the opportunity costs of producing goods in France are constant
An airline can profit by offering standby customers an unsold seat at a substantial discount just before takeoff because
a. additional passengers are needed to balance the load. b. the marginal cost of additional passengers is very small. c. additional passengers add little to fixed costs. d. such passengers add more to profits than do those with reserved seats.