Suppose both the equilibrium price and quantity rise for a particular product. Which of the following best explains this situation?
a. Supply and demand simultaneously increased and the shift in supply was greater than the shift in demand.
b. Supply and demand simultaneously increased and the shift in supply was less than the shift in demand.
c. Supply and demand simultaneously decreased and the shift in supply was greater than the shift in demand.
d. Supply and demand simultaneously decreased and the shift in supply was less than the shift in demand.
B
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OPEC's incentives to produce a stream of long-term profits for its member nations means that oil stocks will
A) probably last quite a while. B) most likely run out quickly. C) not be used or needed in the near future. D) increase indefinitely.
Purchasing a season pass to the local symphony
A) is an example of first degree price discrimination. B) is an example of second degree price discrimination. C) is an example of third degree price discrimination. D) All of the above.
Which of the following is not necessarily a characteristic of perfect competition?
a. low prices b. a large number of buyers and sellers c. a homogeneous product d. perfect information e. easy entry and exit in the long run
The market clearing assumption is
a. a central assumption of the short-run macro model b. the idea that prices in every market will adjust until quantity supplied and quantity demanded are equal c. the idea that excess supply always leads to an increase in demand d. the idea that markets only work when they are in equilibrium e. believed by most economists today to be an unreasonable assumption