The central fact of economics is
A. Production.
B. Equilibrium.
C. Efficiency.
D. Scarcity.
D. Scarcity.
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Fresh orange juice and frozen orange juice are substitutes in production. The price of fresh orange juice rises. As a result, the equilibrium price of frozen orange juice ________ and the equilibrium quantity ________
A) rises; increases B) rises; decreases C) does not change; decreases D) falls; increases E) falls; decreases
Suppose the currency price of the U.S. dollar in terms of the Japanese yen starts to fall. To prevent that from occurring, the U.S. central bank should
A) use U.S. dollars to buy Japanese goods. B) use yen reserves to buy U.S. dollars in the foreign exchange market. C) sell U.S. dollars in the foreign exchange market in exchange for yen. D) buy both U.S. dollars and yen in the foreign exchange market.
If the Federal government enacts a new excise tax of $1.50 per case of soda. Which of the following is most likely to occur?
a. Consumers of soda will pay a higher price and buy a larger quantity. b. Consumers of soda will pay a higher price, which will increase the profits of soda companies, inducing them to sell a larger quantity. c. Consumers of soda will pay a higher price and buy a smaller quantity. d. Consumers of soda will buy less bottled water.
Which group is most likely to be adversely affected by the importation of foreign steel?
A. Domestic steelworkers. B. Foreign steel producers. C. Consumers of domestic automobiles for which steel is an input. D. Domestic automobile workers.