If the price of a product falls too much, the producer can ________________the market.

Suppose the government imposes a 50-cent tax on the sellers of packets of chewing gum. The tax would

a. shift the supply curve upward by less than 50 cents. b. raise the equilibrium price by 50 cents. c. create a 50-cent tax burden each for buyers and sellers. d. discourage market activity.

Amy can produce either 5,000 pounds of cheese or 20 cars per year. Mike can produce either 5,000 pounds of cheese or 10 cars per year. By the principle of comparative advantage, Mike should specialize in producing

A. neither cheese nor cars. B. cars. C. both cheese and cars. D. cheese.