If a hurricane were to wipe out the majority of the eastern seaboard in the United States:

A. neither the short-run nor long-run aggregate supply curves would be affected.
B. only the long-run aggregate supply curve would shift left.
C. only the short-run aggregate supply curve would shift left.
D. the long-run and short-run aggregate supply curves would both shift left.

Answer: D

Economics

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The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________

A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases

Economics

Figure 5-17


In Figure 5-17, the consumer would prefer

a.
D to C.

b.
B to D.

c.
C to B or A.

d.
D to A but not B.

Economics