Why does this graph show an increase in income?
a. area a + c is greater than area b + c
b. area b + c is greater than area a + b
c. area a + b is greater than area b + c
d. area b + c is equal to area a + b
b. area b + c is greater than area a + b
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If the quantity of rental units increases by 10 percent when the monthly rental price doubles, the supply of rental units, other factors held constant, is:
a. elastic. b. inelastic. c. perfectly elastic. d. perfectly inelastic.
Suppose we observe the following two simultaneous events in the market for fish. First, there is a decrease in the demand for fish due to changes in consumer tastes. And second, there is a reduction in seafood supply due to oil spills in the oceans. We
know with certainty that these two simultaneous events will cause which of the following? A) no change in the equilibrium quantity and a reduction in the equilibrium price B) an increase in the equilibrium quantity and in the equilibrium price C) a decrease in the equilibrium quantity and an indeterminate change in the equilibrium price D) a decrease in the equilibrium quantity and an increase in the equilibrium price