If demand and supply both decrease
A) the equilibrium quantity definitely will decrease, and the market clearing price definitely will decrease.
B) the equilibrium quantity definitely will decrease, and the market clearing price definitely will increase.
C) the market clearing price definitely will decrease, but the change in the equilibrium quantity cannot be determined without more information.
D) the equilibrium quantity definitely will decrease, but the change in market clearing price cannot be determined without more information.
Answer: D
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Landon demands more sushi as his income increases. From this we can conclude that, for Landon
A) sushi is a normal good. B) sushi is a substitute good. C) sushi is a complementary good. D) sushi is an inferior good.
One similarity between the policy recommendations of the new classical and monetarist models is that
a. both believe that monetary policy has much stronger employment effects than does fiscal policy. b. are policy activists. c. both believe in the natural rate of output. d. both believe that discretion is preferable to rules. e. none of the above.