Hurricane Katrina damaged a large portion of oil refining and pipeline capacity in the Gulf coast states. In the market for gasoline,
A) the demand curve shifted to the left resulting in a decrease in the equilibrium price.
B) the demand curve shifted to the right resulting in an increase in the equilibrium price.
C) the supply curve shifted to the left resulting in an increase in the equilibrium price.
D) the supply curve shifted to the right resulting in an increase in the equilibrium price.
C
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An article in The Economist reported that prices of CDs in Britain were much higher than prices in the United States or other European countries. There were only a few major companies, and a report from a Parliament committee said there was no serious price competition. The best explanation for this is that
A. the industry was a contestable market. B. there were entry barriers in production and distribution of CDs. C. firms were avoiding profit opportunities. D. there was substantial differentiation of products.
Which of the following policy actions by the Fed would cause the money supply to increase?
a. An open market sale of government securities. b. An increase in required reserve ratios. c. A decrease in the discount rate. d. All of these.
Which statement was coined by Adam Smith?
A. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. B. The factory owner, by paying his workers meager wages, is able to use this surplus to buy more capital goods. C. The foundation of the United States' economic system is socialist ownership of the means of production in the form of state property and collective farm and cooperative property. D. None of these statements were coined by Adam Smith.
An example of a public transfer payment is a(n):
a. Veteran's benefit payment b. Airline pass giving price discounts to senior citizens c. Monthly subsidy from home for a university student d. Gift of land from a wealthy relative