Refer to the accompanying figure. Suppose the solid line shows the demand for coffee. If coffee and tea are substitutes, and the price of tea falls, then you would expect:
A. the demand curve to shift to D(B)
B. the demand curve to shift to D(A).
C. a decrease in the quantity of coffee demanded, but no shift in the demand curve.
D. an increase in the quantity of coffee demanded, but no shift in the demand curve.
Answer: B
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To increase its profit, a perfectly competitive firm will produce more output when
A) price is greater than average fixed cost. B) price is greater than marginal cost. C) marginal cost is less than average total cost. D) average variable cost is greater than average fixed cost. E) price is greater than average variable cost.
A bank finds itself short of required reserves and therefore borrows from another commercial bank. The interest rate on this loan is: a. zero
b. the prime rate. c. the discount rate. d. the federal funds rate. e. the required reserve ratio.
The first money issued by a United States' governmental authority were
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Of the dozen of studies that study the effect on wages, most of the studies show that immigration decreases the wages of:
A. native workers with low levels of education. B. native PhD holders. C. foreign PhD holders in the U.S. D. college students.