Refer to Figure 13-2. Ceteris paribus, an increase in productivity would be represented by a movement from

Prices of microbrewery beer (assume that this is a normal good) have risen steadily in recent years. Over this same period, prices for fermenting vats used in beer making have also risen and consumer incomes have fallen

Which of the following best explains the rising prices of microbrewery beer? A) The supply curve for microbrewery beer has shifted to the left while the demand curve for microbrewery beer has shifted to the right. B) The supply curve for microbrewery beer has shifted to the left more than the demand curve has shifted to the left. C) The demand curve for microbrewery beer has shifted to the left more than the supply curve has shifted to the left. D) The demand curve and the supply curve for microbrewery beer have both shifted to the right.

Suppose the actions of the producers of a good impose an external cost which results in the actual market price of $18 and market output of 400 units. How does this outcome compare to the efficient, ideal equilibrium?

a. The efficient price would higher than $18 while the efficient output would be less than 400 units. b. The efficient price would be higher than $18 while the efficient output would be greater than 400 units. c. The efficient price would be lower than $18 while the efficient output would be less than 400 units. d. The efficient price would be lower than $18 while the efficient output would be greater than 400 units.