During the past twenty years, the prices of prescription drugs, relative to the prices of other goods, have risen, yet Americans buy more prescription drugs than ever. This might be because
A) with higher incomes and more older Americans, we have moved rightward along our demand curve for drugs.
B) with higher incomes and more older Americans, the demand curve for prescription drugs has shifted rightward.
C) more new firms entered the pharmaceutical industry each year, which caused a rightward shift in the supply curve of prescription drugs.
D) Both answers A and C are correct.
B
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The above figure shows the domestic market for wheat. Suppose this market is isolated from global competition and the government intervenes by setting a support price of $15 a ton. The quantity produced once the price support is in place is
A) 400 million tons. B) 300 million tons. C) 100 million tons. D) 250 million tons. E) 200 million tons.
A decrease in the labor force shifts the production possibilities frontier inwards over time
Indicate whether the statement is true or false
Why has the Federal Reserve chairman often been called the second most important person in terms of affecting the economy?
A) The Fed chairman has veto power over all federal spending. B) The Fed is in control of monetary policy. C) The Fed chairman draws the second highest salary of any official of the federal government. D) The Fed has regulatory power over all financial markets.
In the short run, if a firm's total product is increasing: a. its marginal product must be increasing
b. its marginal product must be positive. c. its marginal product could be increasing or decreasing. d. both b. and c. are true.