Some nations try to nurture and encourage new firms with lots of promise, so they protect them from foreign competition. This is called the _________ argument for trade protection.

A decrease (leftward shift) in the supply for a good will tend to cause

a. an increase in the equilibrium price and quantity b. a decrease in the equilibrium price and quantity c. an increase in the equilibrium price and a decrease in the equilibrium quantity d. a decrease in the equilibrium price and an increase in the equilibrium quantity e. none of the above.

The law of supply reflects the fact that

A) people buy more of a good when its price falls. B) suppliers have an incentive to use their resources in the way that brings the biggest return. C) the demand curve is downward sloping. D) higher prices are more attractive to consumers because they signal a higher quality product. E) businesses can sell more goods at lower prices.