To answer the next question, use the following graph showing the domestic demand and supply curves for a specific standardized product in a particular nation.
If the world price for this product is $0.50, this nation will experience a domestic
A. shortage of 160 units, which it will meet with 160 units of imports.
B. surplus of 160 units, which it will export.
C. shortage of 160 units, which will increase the domestic price to $1.60.
D. surplus of 160 units, which will reduce the world price to $1.00.
Answer: A
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A) $5 per hour; 10 hours B) $8 per hour; 20 hours C) 10 per hour; 10 hours D) $12 per hour; 5 hours
The slope of a production possibilities frontier
A) is always varying. B) measures the opportunity cost of producing one more unit of a good. C) has no economic relevance or meaning. D) is always constant.
On September 3, 2003, Universal Music Group announced plans to reduce the wholesale price of music CDs it distributes by an average of 25-30 percent. All else constant (i.e
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Consumer protection legislation includes legislation to
A) reduce discrimination in credit markets. B) require banks to make loans to everyone who applies. C) reduce the amount of interest that bank's can charge on loans. D) require banks to make periodic reports to the Better Business Bureau.