A. increase; increase
B. increase; reduce
C. reduce; reduce
D. reduce; increase
Related Mcqs:
- If the economy is in the expansionary phase of the business cycle, aggregate demand ____ unemployment ____ inflation ____ payments is likely to move towards ____?
A. falls; rise; falls; surplus
B. is static; low; rise; deficit;
C. falls; falls; falls; surplus
D. rise; falls; rises; deficit - The income effect of a price increase of a normal good is to ________ of that good and the substitution effect is to _________ of that good?
A. increase quantity demanded, reduce quantity demanded
B. increase quantity demanded, increases quantity demanded
C. reduce quantity demanded, reduce quantity demanded
D. reduce quantity demanded, increase quantity demanded - Suppose we measure the quantity of good X on the horizontal axis and the quantity of good Y on the vertical axis If indifference curves are bowed inward, as we move from having an abundance of good X to having an abundance of good Y, the marginal rate of substitution of good Y for good X (the slope of the indifference curve) ?
A. rises
B. stays the same
C. could rise or fall depending on the relative prices of the two goods.
D. falls - In a competitive labour market firms will hire labour up to the point where the marginal revenue product of labour equals ?
A. total labour cost
B. the marginal product
C. the price of the product
D. the wage rate - If the income effect is smaller than the substitution effect, higher net wages will ?
A. reduce the supply of labour.
B. increase the demand for labour
C. increase the supply of labour
D. have no effect on the supply of labour - Assuming leisure is a normal good, if the income effect is greater than the substitution effect a wage increase ?
A. will have no effect on labour supply
B. will decreases labour supply
C. could cause either an increases or a decrease in labour supply
D. will increase labour supply. - Suppose that the world price of tin is above the target (ceiling) price that is defined by an international commodity agreement. To move the world price toward the target price, a buffer stock agreement would require its buffer stock manager to ____ tin and an export quota agreement would require that member countries _________ their export of tin?
A. purchase; decrease
B. purchase; increase
C. sell; increase
D. sell; decrease - The effect of a tax to offset a negative externality will be to ____ price and ______ quantity?
A. reduce , reduce
B. increase, increase
C. increase, reduce
D. reduce, increase - Refer to Exhibit 4, Suppose that the consumer must choose between buying socks and belts Also suppose that the consumer’s income is €100 Suppose that the price of a pair of socks falls from €5 to €2 The substitution effect is represented by the movement from point ?
A. Z to point X
B. X to point X
C. X to point Z
D. Y to point X - Suppose both buyers and sellers of wheat expect the price of wheat to rise in the near future. What would we expect to happen to the equilibrium price and quantity in the market for wheat today ?
A. The impact on both price and quantity is ambiguous
B. Price will decrease, quantity is ambiguous.
C. price will increase, quantity will decrease
D. price will increase, quantity is ambiguous.
E. Price will increase, quantity will increase
