A severe drought has damaged this year's lettuce crop. The initial effect on the lettuce market is a
A) decrease in the demand for lettuce.
B) decrease in the supply of lettuce.
C) decrease in both the demand and supply of lettuce.
D) rightward movement along the demand curve for lettuce.
B
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The figure above shows the marginal social cost curve of generating electricity and the marginal private cost curve. The marginal external cost when 200 billion kilowatt hours are produced is
A) 0¢ per kilowatt. B) 10¢ per kilowatt. C) 20¢ per kilowatt. D) 15¢ per kilowatt. E) 5¢ per kilowatt.
Suppose that Firm A cheats, and B does not. What is A's payoff from cheating?
a. 0 b. 50 c. -10 d. 25
In general, when the quantities of a complementary resource are increased, the productivity of the other resources
A. rise. B. fall. C. remain the same.
When the economy enters into a recession, your employer is ________ to reduce your wages because ________
A) likely; aggregate demand is vertical in the long run B) unlikely; lower wages reduce productivity and morale C) likely; output prices always fall during recession D) unlikely; output and input prices generally fall during recession