A severe freeze has once again damaged the Florida orange crop. The impact on the market for oranges will be a leftward shift of:
a. the demand curve, as consumers try to economize because of the shortage
b. the demand curve and a rightward shift of the supply curve.
c. the supply curve.
d. the supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price.
c
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When production of a good results in an external cost, the unregulated competitive market equilibrium is inefficient because ________
A) MSC = MC B) MSC = MB C) MSC > MB D) MSC < MB E) MSC is undefined
For a typical person who is currently earning a low wage rate, the
a. substitution effect of a wage rate increase usually is stronger than the income effect b. substitution effect of a wage rate increase usually is weaker than the income effect c. income effect of a wage rate increase is usually zero d. substitution effect of a wage rate increase is usually zero e. substitution and income effects of a wage rate increase tend to work in the same direction