Assuming that bus travel is an inferior good, an increase in consumer income, other things being equal, will cause a(n):
A. upward movement along the demand curve for bus travel.
B. downward movement along the demand curve for bus travel.
C. rightward shift in the demand curve for bus travel.
D. leftward shift in the demand curve for bus travel.
Answer: D
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In some cases, firms that are accused of antitrust violations by federal authorities will plead guilty to the criminal charges in order to avoid facing the same charges in a private or civil trial. Why?
A) Attorneys in civil cases tend to be more effective at proving their claims. B) The penalties for a conviction in a civil or private case are treble damages, or three times larger than the penalties in a criminal or public case. C) Judges in criminal cases are known to be more lenient. D) none of the above
For a given market demand curve, if the market clearing price increases, then the amount of producer surplus will
A) decrease. B) increase. C) become negative. D) none of the above due to insufficient information.