When stock prices fall significantly, people may feel less wealthy and thus decide to consume less of their current flow of disposable income. In our consumption function, this can be represented by a

A perfectly competitive firm finds that: Average total cost is $25; Average variable cost is $15; Marginal cost is $20 and increasing; Price of the product is $22. This firm should

a. produce more output b. raise the price of its product c. reduce production without shutting down d. shut down (reduce output to zero) e. do nothing (it is currently maximizing profit)

If both market demand and supply decrease simultaneously, then equilibrium quantity will (be) ____ and equilibrium price will (be) ____

a. increase; increase b. indeterminate; decrease c. decrease; indeterminate d. decrease; decrease