There is a 50 percent decrease in the price of lumber used by a firm that builds new homes. This causes
A) a decrease in the quantity of new homes supplied.
B) an increase in the supply of new homes.
C) an increase of the quantity supplied of new homes.
D) a decrease in the supply of new homes.
Answer: B
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Countries that engage in trade will tend to specialize in goods in which they have a(n) _______ and will _______ those goods.
A) comparative advantage; import B) absolute advantage; export C) comparative advantage; export D) economic profit; import
Suppose a firm's hourly marginal product of labor is given by MPN = A (200 - N)
(a) If A = 0.2 and the real wage rate is $10 per hour, how much labor will the firm want to hire? (b) Suppose the real wage rate rises to $20 per hour. How much labor will the firm want to hire? (c) With the real wage rate at $10 per hour, how much labor will the firm want to hire if A rises to 0.5?