The law of demand states that
a. quantity demanded is inversely related to price
b. quantity demanded is directly related to income
c. marginal utility is inversely related to quantity consumed
d. total revenue is directly related to price
e. demand curves are linear
A
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Which of the following is an example of government purchases?
A. The navy purchases a new ship for its fleet. B. Fred buys a new television set to watch the Super Bowl. C. Electric Car Incorporated increases the number of cars on its lots. D. The Black Coal Company sells $5 million of coal to Germany.
The figure above shows the costs for a grower in the perfectly competitive turnip market. If the price is $1,000 for a ton of turnips, the firm is
A) making an economic profit. B) making zero economic profit. C) incurring an economic loss. D) More information is needed to determine if the firm is making a positive economic profit, zero economic profit, or incurring an economic loss.
A small country imports T-shirts. With free trade at a world price of $10, domestic production is 10 million T-shirts and domestic consumption is 42 million T-shirts. The country's government now decides to impose a quota to limit T-shirt imports to 20 million per year. With the import quota in place, the domestic price rises to $12 per T-shirt and domestic production rises to 15 million T-shirts per year. The quota on T-shirts causes domestic consumers to
A. gain $7 million. B. lose $70 million. C. lose $7 million. D. lose $77 million.
Regulation focused on the impact of production on the environment and society, the working conditions under which production occurs, or the physical attributes of goods, is known as
A) cost-of-service regulation. B) rate-of-return regulation. C) social regulation. D) monopoly regulation.