The market system corrects a shortage by:
a. Raising product price to decrease production
b. Lowering product price to increase production
c. Raising product price to increase production
d. Lowering product price to decrease production
Answer: c. Raising product price to increase production
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Suppose we observe people buying more of a good even though its price has risen. What would an economist conclude?
A) Impossible! We will never observe prices and quantity simultaneously rising in the real world. B) The demand curve for the good must be upward-sloping. C) The law of demand doesn't hold. D) The demand curve has shifted to the right. E) Consumption increasing as prices increase only occurs when a good is needed for survival.
According to Coase, firms emerge when
a. transaction costs in the market are less than the cost of hierarchical control b. transaction costs in the market are more than the cost of hierarchical control c. prices in the market are less than the cost of hierarchical control d. prices in the market are more than the cost of hierarchical control e. implicit contracts in the market can be made explicit in a firm
Two groups of workers not counted as unemployed in the official unemployment statistics are ________ workers.
A. discouraged and involuntary part-time B. chronically unemployed and short-term unemployed C. chronically-unemployed and discouraged D. chronically unemployed and involuntary part-time
A television station reports that the price of orange juice has declined but the quantity traded has increased. This situation could be caused by a(n):
A. Increased preference for orange juice among buyers B. Significant decrease in the harvest of oranges in the nation's orchards C. Improvement in the technology of producing orange juice D. Decrease in income, and orange juice is a normal good