Referring to the previous question, as a result of the consumer's adjustment to the change in the price of Y, assuming Y is a normal good and X and Y are complements, it is reasonable to expect that the amount of Y consumed will ________, and the
amount of X consumed will ________: A) increase; decrease
B) decrease; decrease
C) increase; increase
D) cannot be determined; cannot be determined
C
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Two duopoly firms that sell an identical good form a cartel. They decide to collude and fix the price of their good. In this prisoners' dilemma type situation, the likely outcome is
A) both will cheat. B) neither one will cheat. C) only one will cheat. D) It is impossible to say.
Which statement makes sense? a. Fixing exchange rates causes currency markets to reach equilibrium quickly. b. Having an absolute advantage in the production of goat cheese means the country will specialize in and produce all of the goat cheese traded
c. Arbitrage opportunities are quickly taken. d. Floating exchange rates reduce uncertainty in the currency markets. e. When the dollar depreciates, U.S. consumers can buy more imported goods.
When something of value has no price attached to it,
a. externalities will be present. b. production of the product has no cost. c. government should not intervene to produce the product. d. private companies will eventually produce the product, and the good will no longer be free.
The national defense of the United States is not excludable because
a. my enjoyment of the national defense does not diminish your enjoyment of the national defense of the United States. b. my enjoyment of the national defense does diminish your enjoyment of the national defense of the United States. c. once the nation is defended, it is impossible to prevent any single person from enjoying the benefit of this defense. d. once the nation is defended, it is possible to prevent any single person from enjoying the benefit of this defense.