Suppose Jack Weldon came up with a novel idea of making lamps out of recycled automobile tires. His firm, No-Skid Lamps, works three shifts a day trying to keep up with demand. Attracted by its success, other firms copy the idea and produce similar lamps. As a result, No-Skid Lamps' demand curve
a. shifts to the right and becomes more inelastic
b. shifts to the right and becomes more elastic
c. shifts to the left and becomes more inelastic
d. shifts to the left and becomes more elastic
e. stays the same
D
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When entry occurs in a monopolistically competitive industry, which of the following will likely occur?
a. Marginal costs to society will exceed the price people are willing to pay. b. Price will be equal to the marginal revenue gained by society. c. The marginal revenue curve will shift to the left. d. A smaller quantity will be demanded at any given price.
If the real exchange rate for the dollar is above the equilibrium level, the quantity of dollars supplied in the market for foreign-currency exchange is
a. greater than the quantity demanded and the dollar will appreciate. b. greater than the quantity demanded and the dollar will depreciate. c. less than the quantity demanded and the dollar will appreciate. d. less than the quantity demanded and the dollar will depreciate.
Which of the following is a positive economic statement?
A) People should use public transportation more often. B) The government should ban diesel engines in automobiles. C) Due to a decrease in state funding, university tuition has risen. D) Foreign citizens should not be allowed to work without a work visa.
Which of the following leads to an increase in real GDP?
A) a decrease in the inflation rate in other countries relative to the inflation rate in the United States B) a decrease in interest rates C) a decrease in government spending D) Households have increasingly pessimistic expectations about future income.