When a shortage occurs in the market for a good, quantity
A. demanded exceeds quantity supplied and the market mechanism pushes the price up, which in turn encourages more production and less consumption.
B. supplied exceeds quantity demanded and the price falls, which encourages more production and less consumption.
C. demanded exceeds quantity supplied and the market mechanism pushes the price down, which encourages more production and less consumption.
D. supplied exceeds quantity demanded and the price rises, which encourages more production and less consumption.
Answer: A
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Refer to Figure 11-10. Identify the minimum efficient scale of production
A) Qa B) Qb C) Qc D) Qd
Because there is a trade-off between inflation and unemployment in the short run,
A. lower unemployment will typically cause inflation to fall. B. policies designed to reduce unemployment will typically set off a recession. C. policies designed to reduce inflation will cause unemployment to fall as well. D. higher inflation will generally be associated with higher unemployment. E. lower inflation will generally be associated with higher unemployment.
What is the outcome of demand-side policies when aggregate supply is upward-sloping?
What will be an ideal response?
An individual wheat farmer produces wheat in a perfectly competitive market. A decrease in the market demand for wheat will cause the farmer's marginal revenue to ________ and his profit-maximizing level of output to ________.
A. increase; increase B. increase; decrease C. decrease; increase D. decrease; decrease