It is appropriate to use the supply-and demand-model if, in a market
A) everyone is a price taker with full information about the price and quality of the good.
B) firms sell identical products.
C) costs of trading are low.
D) All of the above.
D
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Stock prices in Richland declined suddenly after one of the largest banks in Richland faced bankruptcy. If animal spirits play an important role in shaping Richland's economy, which of the following is likely to happen assuming all else equal?
A) Equilibrium unemployment in Richland will fall. B) Equilibrium wage levels in Richland will fall. C) Investment by firms in Richland will increase. D) Richland's consumption expenditure will increase.
"Higher ethanol production definitely and directly raises the price of corn," said USDA economist Ephraim Leibtag. In the short run in the corn market, what is TRUE if the production of ethanol increases?
A) The demand curve for individual corn farmers will shift upward. B) The price individual corn farmers receive will decrease. C) The total cost curve for individual corn farmers will shift upward. D) The marginal cost curve for individual corn farmers will shift downward.
During the business cycle, an economic upturn occurs:
A. at the peak of the business cycle. B. in between the trough and peak of the business cycle. C. in between the peak and trough of the business cycle. D. at the trough of the business cycle.
Some economists argue that there were good reasons for housing price to rise. Explain their argument
What will be an ideal response?