If a shortage exists in a market, the natural tendency is for:
A. price to increase.
B. quantity supplied to decrease.
C. demand to increase.
D. no change in the market.
Answer: A
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A supply schedule shows the relationship between:
a. demand and supply. b. supply and income. c. price and income. d. quantity supplied and price. e. income and quantity supplied.
When considering whether to migrate to a particular location, one calculates the present value of living in that location. How does one best calculate the present value of living in a location?
A. Determine the starting wage one will earn in the location. B. Sum up the annual incomes one will earn in the location. C. Subtract one's wage in the new location from the starting wage in the current location. D. Sum the annual discounted incomes one will earn in the location. E. Subtract one's wage in the current location from the starting wage in the new location.
Answer the following statement true (T) or false (F)
1) The wants of consumers are expressed in the product market with "dollar votes." 2) Costs can be defined as total payments made to workers, land owners, and capital suppliers less payments to the entrepreneur for organizing and combining the other resources used to produce a good. 3) Continued losses in an industry will cause some firms to reduce output or eventually leave the industry. 4) The guiding function of prices tends to keep resources flowing toward their most highly valued uses.
The marginal propensity to consume (MPC) can best be defined as the fraction of
A. real disposable income that is consumed. B. real disposable income that is not consumed. C. a change in real disposable income that is saved. D. a change in real disposable income that is spent.