Figure 3-12
In , suppose D1 and S1 indicate initial conditions in the market for ice cream. Which of the following changes would tend to shift this market from D1 to D2?
a.
an increase in the price of milk, an ingredient used to produce ice cream
b.
an increase in the price of frozen yogurt, a substitute for ice cream
c.
a decrease in the price of sugar, an ingredient used to produce ice cream
d.
a decrease in consumer income
b
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In the aggregate expenditures model, consumption depends on
A. disposable income. B. the natural rate of unemployment. C. whether the government has a budget surplus or deficit. D. potential output.
The above figure shows supply and demand curves for apartment units in a large city. The area "c" represents
A) the loss in consumer surplus if a rent ceiling of $350 is imposed. B) a transfer from producers to consumers if a rent ceiling of $350 is imposed. C) a transfer from consumers to producers if a rent ceiling of $350 is imposed. D) the total revenue received by supplying Q1 units.
Consider two resource markets in which the demand curves slope downward. In market A, the supply curve is horizontal, equilibrium price is $6, and 100 units of the resource are hired. In market B, the supply curve is vertical, equilibrium price is $20, and 30 units of the resource are hired. Which of the following is true?
a. All of the resource earnings in market A are opportunity costs. b. All of the resource earnings in both markets are opportunity costs. c. All of the resource earnings in market B are opportunity costs. d. None of the resource earnings in either market is an opportunity cost. e. None of the resource earnings in either market is economic rent.
The 27-member EU negotiates trade agreements as one. The EU and Brazil have negotiated a strategic trade alliance, which is an example of a ________.
A) customs union B) global free trade agreement C) bilateral agreement D) multilateral agreement