Leather used in making shoes comes from cattle, which are also raised for beef production. Holding all other factors constant, suppose that the world demand for beef decreases. What is the expected affect in the market for leather shoes? A. The equilibrium price will increase, but the equilibrium quantity will decrease. B. The equilibrium price will decrease, but the equilibrium quantity will increase C. The equilibrium price will increase, but the equilibrium quantity is undetermined. D. The equilibrium price and the equilibrium quantity will both decrease. E. The equilibrium price and the equilibrium quantity will both increase.
Related textbook solutions
Related questions
1. A change in quantity supplied:
A. refers to a shift in the supply curve.
B. results from a change in a determinant of supply.
C. refers to a movement along a given supply curve.
D. is caused by a change in the number of sellers in the industry.
2. Which one of the following would most likely cause the supply curve for microwaves to shift to the right:
A. a decrease in the price of microwaves.
B. an increase in the wage rate earned by workers who produce microwaves.
C. a decrease in consumer preferences for microwaves.
D. an increase in the number of firms that produce microwaves
3. If the actual price sellers are pricing their goods at is currently above the equilibrium price. There is a ____________. Therefore, we would expect sellers to ____________ the price until the market reaches equilibrium.
| A. |
surplus; raise |
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| B. |
surplus; lower |
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| C. |
shortage; raise |
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D. shortage; lower 4. Suppose the demand and the supply of wine both increase. The net effect of these changes in demand and supply will be
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QUESTION 38
You are the president of the United States. In an attempt to make gasoline prices cheaper, you have imposed a binding price ceiling on gas. What would you expect your critics to say?
| a. |
The binding price ceiling will cause firms to minimize their spending on the research and development of alternatives to gasoline. |
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| b. |
The binding price ceiling will discourage individuals from using their personal automobile to commute to work or school. |
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| c. |
The binding price ceiling will increase the likelihood that customers obtain needed |
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| d. |
The binding price ceiling will encourage oil companies to deplete the resource too quickly. |
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| e. |
The binding price ceiling will cause firms to produce only gasoline of the highest quality. |
1.05000 points
QUESTION 39
If a firm's long-run average total costs increase as it increases its scale of production, the firm is experiencing:
| a. |
increasing returns from specialization. |
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| b. |
diseconomies of scale. |
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| c. |
economies of scale. |
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| d. |
constant returns to scale. |
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| e. |
diminishing marginal product. |
1.05000 points
QUESTION 40
A(n) __________ in the elasticity of supply or demand in a market for a good that is taxed would tend to __________ tax revenue from that tax.
| a. |
increase; increase |
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| b. |
increase; have no effect on |
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| c. |
decrease; have no effect on |
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| d. |
decrease; decrease |
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| e. |
increase; decrease |
1.05000 points
QUESTION 41
The costs of a market activity paid for by an individual engaged in the market activity are:
| a. |
external costs. |
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| b. |
social costs. |
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| c. |
common costs. |
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| d. |
free-rider costs. |
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| e. |
internal costs. |
1.05000 points
QUESTION 42
Assume that the price of rubber increased at the same time that Michael Jordan, arguably the best NBA basketball player of all time, became famous. What do you expect to happen to the equilibrium price and equilibrium quantity of the basketball shoes that are promoted by Michael Jordan?
| a. |
Equilibrium price will go down and equilibrium quantity will be indeterminate. |
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| b. |
Equilibrium price will go up and equilibrium quantity will go down. |
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| c. |
Equilibrium price will go up and equilibrium quantity will be indeterminate. |
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| d. |
Equilibrium price will go down and equilibrium quantity will go up. |
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| e. |
Equilibrium price will go up and equilibrium quantity will go up. |
1.05000 points
QUESTION 43
The minimum wage law is an example of a:
| a. |
price floor. |
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| b. |
law that sets the minimum number of hours that an employee must work for wages during the week. |
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| c. |
law that allows individual employers and employees to make free decisions. |
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| d. |
law that requires quantity demanded to equal quantity supplied. |
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| e. |
price ceiling. |
