Which of the following is the most likely effect of lower apple juice prices on the price and quantity purchased of orange juice, a substitute product?
a. The price of orange juice will increase, and the quantity purchased will fall.
b. The price of orange juice will fall, and the quantity purchased will increase.
c. The price of orange juice will increase, and the quantity purchased will increase.
d. The price of orange juice will fall, and the quantity purchased will fall.
d
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Concentration ratios may be inaccurate indicators of the degree of monopoly power in an industry because:
A. they include interindustry competition. B. foreign competition is not considered. C. they are only calculated for local and regional markets. D. they do not distinguish between normal and economic profit.
Monetary policy operations for central banks are run through changes in the liability category of:
A. currency. B. government's accounts. C. gold. D. reserves.