Consider the demand curves for soft drinks shown in the figure above. Moving from point a to point c means that
A) the marginal benefit of each additional soft drink falls.
B) the opportunity cost of another soft drink increases.
C) people's incomes have decreased.
D) the price of a soft drink has increased.
A
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The above figure shows the market for labor. The employer is a monopsony. At the equilibrium level of employment, which of the following is CORRECT?
A) MCL = VMP B) VMP > W C) W < MCL D) All of the above are correct.
Why does the gravity model work?
A) Large economies became large because they were engaged in international trade. B) Large economies have relatively large incomes, and hence spend more on government promotion of trade and investment. C) Large economies have relatively larger areas which raises the probability that a productive activity will take place within the borders of that country. D) Large economies tend to have large incomes and tend to spend more on imports. E) Large economies tend to avoid trading with small economies.