How does the increasing use of MP3 players affect the market for compact discs?
A) The demand curve for compact discs shifts to the left.
B) The supply curve for compact discs shifts to the left.
C) The demand curve for compact discs shifts to the right.
D) The supply curve for compact discs shifts to the right.
A
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If the Fed chooses to sell bonds on the open market, it is attempting to:
a) lower interest rates using expansionary monetary policy. b) lower interest rates using contractionary monetary policy. c) raise interest rates using expansionary monetary policy. d) raise interest rates using contractionary monetary policy.
At its present rate of output, Barrel O' Biscuits, a perfectly competitive firm, finds that its marginal cost exceeds its marginal revenue and price exceeds average variable cost. To maximize profit, the firm should
a. lower the price b. raise the price c. increase output d. reduce output e. maintain its current rate of output