If both the demand for a product and the supply of it decrease, then the equilibrium quantity will ________ and the equilibrium price will ________.
A) increase; either increase, decrease, or remain constant
B) decrease; either increase, decrease, or remain constant
C) increase; increase
D) increase; decrease
Ans: B) decrease; either increase, decrease, or remain constant
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In relation to prices that would prevail in an uncontrolled market, prices charged by a black market are usually
a. lower, since it is hard for the sellers to locate buyers. b. lower, since it is hard for the buyers to locate sellers. c. higher, since black marketers expect compensation for the risk of being caught. d. higher, since most people enjoy goods more if they are illegal.
In 2010, in order to stimulate capital investment, President Obama proposed
a. a reduction in real interest rates. b. an increase in the money supply. c. increased write-offs for businesses purchasing equipment. d. an increase in the tax on capital gains.