An increase in the price of labor used to produce good A will lead to
A. an increase in the demand for good A.
B. an increase in the market clearing price of good A.
C. an increase in the supply of good A.
D. a decrease in the demand for good A.
Answer: B
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When medical fee schedules are negotiated by two monopolists—one representing patients and one representing providers—the equilibrium medical fees will
a. be greater than fees determined in a competitive market. b. be less than fees determined in a competitive market. c. be greater than fees determined by provider groups alone. d. be less than fees determined by patient groups alone. e. depend on the relative bargaining strengths of the two groups negotiating the fee schedule.
A constant-cost industry is one
a. that faces constant average costs in the short run b. that experiences economies of scale c. that experiences stable demand d. whose cost curves do not change as new firms enter e. that faces increasing resource prices as new firms enter
Let's play Jeopardy. The answer is: Because more goods are produced at lower prices and no country loses. The question is:
a. Why do countries engage in dumping? b. Why do countries retaliate? c. Why do nations trade? d. Why is comparative advantage preferred to absolute advantage? e. Why is absolute advantage preferred to comparative advantage?
Which of the following factors weakens the case for government provision of goods and services relative to private-sector provision?
a. monopoly b. externalities c. public goods d. the special-interest effect