A decrease in demand, accompanied by a simultaneous decrease in supply, will always cause the equilibrium price and quantity of the good to fall
Indicate whether the statement is true or false
F
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Secondary effects are consequences of economic actions that develop slowly over time as people react to events
a. True b. False
Suppose Beth Dollins, Nike's CEO, decides to produce 1 million pairs of cross-training shoes, but when the shoes reach the market, consumers decide to buy only 600,000 pairs. Assuming Nike's situation is similar to other producers, the most likely resulting scenario would be
a. an increase in overall production and an increase in the economy's unemployment b. a cutback in overall production and an increase in the economy's unemployment c. a decrease in real GDP and a decrease in the economy's unemployment d. a decrease in real GDP and no effect on the economy's unemployment e. no change, because Nike will not alter its production plans due to short-run market changes
Which of the following ideas of Adam Smith has religious overtones?
a. comparative advantage b. aggregate demand c. perfect competition d. rational expectations e. invisible hand
Since 1950, farm productivity has:
A. advanced twice as fast as in nonfarm sectors of the economy. B. lagged behind productivity advances in the nonfarm economy. C. almost exactly matched productivity increases in the rest of the economy. D. doubled.