Suppose the demand curve for medical care services is perfectly inelastic. What will happen to the equilibrium price and quantity if supply increases?
a. Price and quantity will rise.
b. Price will stay the same and quantity will rise.
c. Price and quantity will fall.
d. Price will fall and quantity will increase.
e. Price will fall and quantity will stay the same.
E
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Typically, as a firm hires additional workers, the marginal product of labor
a. decreases, and the value of the marginal product of labor decreases. b. stays constant, and the value of the marginal product of labor decreases. c. decreases, and the value of the marginal product of labor stays constant. d. decreases, and the value of the marginal product of labor increases.
In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the
equilibrium quantity (Q) of X. Refer to the given information. A reduction in the number of firms producing X will: A. increase D, increase P, and increase Q. B. increase S, decrease P, and increase Q. C. decrease S, increase P, and decrease Q. D. decrease S, decrease P, and increase Q.