A worldwide hops (a flower used in brewing) shortage made stouts, ales and other specialty microbrews more pricy in 2008. Gayle Goshie, a hops farmer, blames overproduction for hops' previously cheap place on the agricultural market
The glut pushed many hops farmers out business, which gradually helped hops prices recover. Suppose farming hops is a perfectly competitive market. How did farmers going out of business help hops prices recover? A) Fewer farmers cause the market supply curve to shift leftward, causing price to rise.
B) Fewer farmers cause an increase in market demand, causing price to rise.
C) Fewer farmers cause an increase in the surviving firms' costs, causing higher prices.
D) Fewer farmers cause the individual firms' supply curves to decrease, causing higher prices.
A
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Exhibit 5-10 GDP data (billions of dollars) Indirect business taxes$ 600 Depreciation950 Change in business inventories50 Compensation of employees5,400 Corporate profits700 Durable goods600 Exports100 Social Security taxes360 Transfer payments300 Fixed investment950 Government spending800 Imports150 Net interest500 Nondurable goods2,000 Personal taxes1,000 Rental income200 Services4,000 In Exhibit 5-10, and using the expenditures approach, compute net exports (X-M). Which of the following is correct?
A. $500 billion. B. $150 billion. C. $100 billion. D. -$50 billion.
What is the real value of money?
A. its face value B. its compounded earnings in banks C. the quantity of goods it can buy D. the ability of shop at market prices
Generally, expenses on toothpaste are a small part of a consumer's budget, so the demand for toothpaste is more likely to be
A) elastic. B) inelastic. C) unit elastic. D) perfectly elastic.
If net exports are positive:
A. the equilibrium GDP must be greater than the full-employment GDP. B. imports must exceed exports. C. aggregate expenditures are greater at each level of GDP than when net exports are zero or negative. D. some other component of aggregate expenditures must be negative.