Which of the following events would definitely cause a decrease in the equilibrium price of cotton shirts?
a. An increase in the price of wool shirts and a decrease in the price of raw cotton.
b. A decrease in the price of wool shirts and a decrease in the price of raw cotton.
c. An increase in the price of wool shirts and an increase in the price of raw cotton.
d. A decrease in the price of wool shirts and an increase in the price of raw cotton.
b. A decrease in the price of wool shirts and a decrease in the price of raw cotton.
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Inga's graph of her budget line has apples per week on the vertical axis and loaves of bread per week on the horizontal. A fall in the price of an apple shifts the
A) horizontal intercept leftward. B) horizontal intercept rightward. C) vertical intercept downward. D) vertical intercept upward.
A perfectly competitive firm initially is earning zero economic profit. Then, a decrease in demand for the firm's product occurs. Of the following, in the long run which action listed below is the firm most likely to take?
A) Increase the quantity it produces. B) Increase its advertising to increase the demand for its product. C) Exit the market. D) Increase the size of its plant.
Suppose a bank has $100,000 in checking account deposits with no excess reserves and the required reserve ratio is 10 percent. If the Federal Reserve raises the required reserve ratio to 12 percent, then the bank will now have excess reserves of
A) $12,000. B) $0. C) -$2,000. D) -$12,000.
Countervailing duties are intended to neutralize any unfair advantage that foreign exporters might gain because of foreign
A) tariffs. B) subsidies. C) quotas. D) Local-Content legislation. E) comparative advantage.