If a subsidy (going to consumers) on a good is eliminated, this would
A. cause a movement along the demand curve to a (lower price, higher quantity) point.
B. cause a movement along the demand curve to a (higher price, lower quantity) point.
C. move its demand curve to the right.
D. move its demand curve to the left.
Answer: D
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The graphs above show the production possibilities curves for the U.S. and Canada, which both produce cars and wheat. Based on the graphs above, which of the following is true?
A) The opportunity cost of a car in the U.S. is 1 unit of wheat. B) The opportunity cost of a car in the U.S. is 5 units of wheat. C) The opportunity cost of a car in Canada is 1/2 unit of wheat. D) The opportunity cost of a car in Canada is 2 units of wheat.