Flour is an input used to produce bread. Suppose that the price of flour rises. As a result
A. the supply curve for flour will shift to the right.
B. the supply curve for bread will shift to the left.
C. the supply curve for bread will shift to the right.
D. the supply curve for flour will shift to the left.
Answer: B
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The ABC Nail Company has entered into a collusive agreement with the other firm in the industry, the DC Nail Company. What occurs in the nail industry if ABC decides to cheat on the agreement?
A) ABC lowers the price of its nails. B) The total industry output increases. C) The total profits in the nail industry will decrease. D) All of the above answers are correct.
The existence of a monopoly:
A. creates market inefficiencies. B. causes consumers to get less at a higher price. C. causes a reduction in total surplus. D. All of these statements are true.
A rational person:
A. makes choices based on added benefits and added costs. B. considers the financial benefits and financial costs of making a choice. C. undertakes activities until the net benefits become less than zero. D. makes choices based on total benefits and total costs.
Based on this graph, in order for supply-side policies to move equilibrium to point E2, ______.
a. long-run aggregate supply and short-run aggregate supply must shift rightward, and aggregate demand must remain unchanged
b. aggregate demand must shift rightward, and long-run aggregate supply and short-run aggregate supply must remain unchanged
c. long-run aggregate supply and short-run aggregate supply must shift leftward, and aggregate demand must shift rightward
d. long-run aggregate supply, short-run aggregate supply, and aggregate demand must all shift rightward