In constructing a short-run aggregate supply curve, we assume that the goal of business is to:
a. maximize sales revenue
b. maximize profit.
c. maximize growth in assets.
d. maximize growth in sales.
e. minimize cost.
b
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In the figure, the equilibrium price is initially $3 per bushel of wheat. If suppliers come to expect that the price of a bushel of wheat will rise in the future, but buyers do not, the current equilibrium price will
A) rise. B) not change. C) fall. D) Perhaps rise, fall, or stay the same, depending on whether there are more demanders or suppliers in the market.
What is the difference between an expenditure-changing policy and an expenditure-switching policy?
What will be an ideal response?
In general, horizontal mergers will
A) increase the number of firms in an industry. B) decrease the number of firms in an industry. C) increase competition in an industry. D) reduce economic profits in an industry.
Assume that the graphs show a competitive market for the product stated in the question.
Select the graph above that best shows the change in the market for leather coats when leather coats become more fashionable among young consumers.
A. graph (1) B. graph (2) C. graph (3) D. graph (4)