Use the following table for a certain product's market in Marketopia to answer the next question.Quantity Demanded DomesticallyPriceQuantity Supplied Domestically1,400$102,2001,60092,0001,80081,8002,00071,6002,20061,4002,40051,200If the world price for this product is $6, then domestic producers in Marketopia would lose revenue equal to
A. $6,000.
B. $14,400.
C. $8,400.
D. $2.
Answer: A
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Suppose early Friday morning the economics club buys 200 donuts at 25 cents each, and plans to sell all of them later in the day on campus for 50 cents each
Only 60 donuts are sold at 50 cents, however, and by early afternoon the club is seen trying to unload the remaining donuts for 10 cents each. What can we conclude? A) The club was clearly engaging in predatory pricing of donuts. B) The club was clearly selling below cost. C) The club clearly misjudged the demand for donuts. D) All of the above are true.
Assume Willow's income to spend on either earrings or hairbands is $24. If her budget constraint is pictured in the graph shown, which of the following must be true?
A. Willow will buy more hairbands than earrings because they are less expensive.
B. Willow will buy more earrings than hairbands because they are less expensive.
C. Hairbands must cost $3, and earrings must cost $6.
D. Hairbands must cost $8, and earrings must cost $4.
The amount of money ultimately created per dollar deposited when people hold no cash is found using the:
A. excess reserve ratio. B. required reserve ratio. C. money demand ratio. D. money multiplier.
Which statement is false, given what you know about the local substitution argument?
A. People in the town will buy their clothes with team logos on them, so the economic impact of that buying must be counted as additional money to the city from having the sports team there. Also, people in the town will go to the games and buy tickets, food, and souvenirs, causing the economy of the town to get better. B. People in the town will go to the games and buy tickets, food, and souvenirs, causing the economy of the town to get better. C. People in the town will buy their clothes with team logos on them, so the economic impact of that buying must be counted as additional money to the city from having the sports team there. D. People from out of town will go to the games and buy tickets, food, and souvenirs, causing the economy of the town to get better.