An increase in demand and a decrease in supply cause which of the following?
A. Equilibrium price change is indeterminate.
B. Equilibrium quantity decreases.
C. Equilibrium price falls.
D. Equilibrium price rises.
Answer: D
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The demand for apple pies is perfectly elastic. If the government taxes apple pies at $1 a pie, then
A) the seller pays the entire tax. B) the buyer pays the entire tax. C) the seller and the buyer split the tax evenly. D) the seller and the buyer split the tax but the seller pays more. E) who pays the tax depends on whether the government imposes the tax on pie buyers or on pie sellers.
In recent years, average household income in the United States was highest for households headed by someone aged
A) 35 to 44. B) 45 to 54. C) 55 to 64. D) 65 and over.
Tesla Motors manufacturers its cars at a plant in Fremont, California
At this plant, Tesla is able to take advantage of the high level of technical training possessed by its American workers, but it also sacrifices the ability to pay lower wages had it chosen to open its plant in a low-wage country such as Mexico, India, or China. In deciding to open the Fremont plant, Tesla A) eroded some of its competitiveness in the luxury electric car market because of its increased cost of production. B) faced a trade-off between higher cost and lower precision. C) faced no trade-offs because employing more technically-skilled workers increased efficiency. D) adopted a negative technological change because it chose high-skilled workers over low-paid workers.
When the U.S. experiences economic growth, the poverty rate will:
A. fall, because growth has benefited everyone. B. increase, because growth typically only benefits the richest 1 percent. C. fall, because growth typically helps the poor more than the wealthy. D. increase, because growth has benefited the wealthy more than the poor.