In the 1990s, many people had rising incomes. At the same time, there was a rise in cost of wood. Holding other factors constant, the demand for houses_________ and the supply for houses_________

________ economists believe that active help from fiscal and monetary policy is needed to insure that the economy is operating at full employment

A) Keynesian B) Monetarist C) Classical D) All

The Bumpy Ride Suspension company makes springs for bicycle seats. Currently the springs sell for $5 each. Being profit maximizers, the company makes just enough springs so that the marginal cost of the last spring produced is $5 . Their average total

cost at that output is $3.50 . If they currently produce 1,000 springs and the market price falls by $1, approximately how much profit will be lost? a. all of the profit will be lost b. profit will fall by $1 per spring c. there will be no loss of profit d. more than $1,000 but less than $1,500 e. less than $1,000