Exercise 2 - Exercise 2 1. What of the following is the...

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Exercise 2 1. What of the following is the best statement of the idea “equilibrium”? A. Models’ characteristic that the opposing dynamic forces cancel each out; B. Models’ characteristic that the market outcome is best for all economic factors; C. description of a state where supply equals demand; D. description of a state where quantity supplied equals quantity demanded. 2. If good X has more substitutes than good Y, then: A. X’s demand curve will likely be flatter than Y’s B. X’s demand curve will likely be steeper than Y’s; C. Both of the A and B are possible; D. Neither A nor B is possible. 3. Suppose there is a wheat market, a bad wheat harvest can be best described as: A. Demand curve will shift to the right; B. Demand curve will shift to the left; C. Supply curve will shift to the right; D. Supply curve will shift to the left. 4. In the case of question 3, if other things constant, we will expect farmers’ total revenue: A. Decrease; B. Increase; C. No change; D. Both A and B are possible.
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Exercise 2 - Exercise 2 1. What of the following is the...

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