Holding all other factors constant, which of the following does not shift the demand curve rightward?
(a) An increase in income considering it is a normal good.
(b) A fall in the price of a substitute.
(c) An increase in the number of buyers.
(d) (a) and (c).
Answer: (b) A fall in the price of a substitute.
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The prediction that workers get additional training only when the rewards from the training are expected to exceed the costs of the training (including the opportunity costs) is based on the:
A. cost-benefit principle. B. principle of comparative advantage. C. principle of diminishing returns to capital. D. scarcity principle.
If aggregate output is below its equilibrium level ________
A) there is an excess demand for goods B) actual output is below planned expenditure C) firms will tend to replenish their low inventories driving output up toward equilibrium D) all of the above E) none of the above
Social Security contributions are a tax on labor
a. True b. False
If you are willing to sell your car business for $500,000 and someone offers you $420,000 for it, this transaction will generate:
a. There is no surplus created b. $80,000 worth of seller surplus and unknown amount of buyer surplus c. $40,000 worth of buyer surplus and $40,000 of seller surplus d. $80,000 worth of buyer surplus and unknown amount of seller surplus