Consider the market for grapes. An increase in the wage paid to grape pickers will cause the:
A. demand curve for grapes to shift to the right, resulting in a higher equilibrium price for grapes and a reduction in the quantity consumed.
B. demand curve for grapes to shift to the left, resulting in a lower equilibrium price for grapes and an increase in the quantity consumed.
C. supply curve for grapes to shift to the right, resulting in a lower equilibrium price for grapes and an increase in the quantity consumed.
D. supply curve for grapes to shift to the left, resulting in a higher equilibrium price for grapes and a decrease in the quantity consumed.
Answer: D
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Your textbook authors use the urban traffic example to show
A) why economics cannot explain non-financial processes. B) how social cooperation emerges when people act under generally accepted rules. C) how a smooth flow of traffic can only be achieved by detailed, central planning. D) how a smooth flow of traffic can only be achieved if people drive in the public interest.
Although there are many examples of game theory in the real world, how well do you think specifics like payoff matrices, Nash equilibrium, and dominant strategies translate to reality?
What will be an ideal response?
A perfectly competitive industry's short-run supply curve is best described as
A) the upward sloping portion of the industry's marginal cost curve. B) horizontal. C) perfectly inelastic. D) the horizontal summation of the individual firms' supply curves.
According to Modigliani's life-cycle hypothesis, the
a. MPC for young adults is relatively low b. middle-aged experience their highest and most rapidly growing MPCs c. MPC falls during middle-age d. MPC falls during old age e. MPC is constant throughout a lifetime