Which group would be most likely to benefit from a binding price floor imposed on wheat?
a. buyers of wheat that are seeking lower prices
b. sellers of wheat that are seeking higher prices
c. sellers of goods considered complements to wheat, hoping to sell larger quantities of their products
d. consumer groups hoping to keep overall food prices low
Ans: b. sellers of wheat that are seeking higher prices
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The demand curve for bonds would be reduced by
A) a decrease in expected returns on other assets. B) an increase in the information costs of bonds relative to other assets. C) an increase in wealth. D) an increase in the liquidity of bonds relative to other assets.
Which of the following is an implication of the law of diminishing returns?
A. Total output will decline as more workers are hired. B. In the long run, average total cost will eventually decline as output is expanded. C. In the short run, expansion of output will eventually lead to increases in marginal cost and average total cost. D. A doubling of all inputs will lead to more than a doubling of output.