Assuming conventional supply and demand curves, changes in the determinants of both supply and demand will generally:
A. alter both equilibrium price and quantity.
B. alter equilibrium quantity but not equilibrium price.
C. alter equilibrium price but not equilibrium quantity.
D. have no effect on equilibrium price or quantity.
Answer: A
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Fixed costs are ________ in a natural monopoly, so average total cost ________ as output increases
A) large; increases B) large; decreases C) small; increases D) small; decreases E) nonexistent; decreases
Legally established titles to the ownership, use, and disposal of factors of production are referred to as
A) property rights. B) Coase rights. C) pollution rights. D) emission rights. E) price-setting rights.
Which of the following groups would not tend to lose from unexpected inflation? a. Retirees on fixed pensions
b. Creditors. c. Those whose incomes are tied to long-term contracts. d. Those whose wages have cost of living adjustment clauses in their contracts.
Which of the following is not a characteristic of a competitive market?
A. A large number of buyers and sellers. B. Firms can enter and exit the market freely. C. Firms sell differentiated products. D. All market participants have full information about cost and prices.