The price of oranges falls. What happens in the market for apples, which are a substitute for oranges?
A) The equilibrium price falls and the equilibrium quantity rises.
B) The equilibrium price rises and the equilibrium quantity falls.
C) The equilibrium price and quantity rise.
D) The equilibrium price and quantity fall.
Ans: D) The equilibrium price and quantity fall.
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"Mandating longer sentences for any criminal's third arrest will lead to a reduction in crime. Less crime will reduce the number of police officers cities will hire." This quotation: a. contains positive statements only
b. contains normative statements only. c. contains both normative and positive statements. d. contains neither normative nor positive statements.
Which of the following would be least likely to affect the supply of automobiles?
a. higher prices for steel and other resources used in producing automobiles b. a successful physical fitness plan encouraging Americans to walk rather than drive to their destinations c. a technological improvement reducing the production costs of automobiles d. increased wages for members of the United Auto Workers union