Midterm1_v1_Fall2013_Solution

Zenland produces and consumes 50 units of grain and

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Unformatted text preview: o the equilibrium price of new cars if the price of gasoline rises, the price of steel falls, public transportation becomes cheaper and more comfortable, auto- workers accept lower wages, and automobile insurance becomes more expensive? a. Price will rise. b. Price will fall. c. Price will stay exactly the same. d. The price change will be ambiguous. 7. [4%] Which of the following might cause the demand curve for an inferior good to shift to the left? a. A decrease in income. b. An increase in the price of a substitute. c. An increase in the price of a complement. d. None of the above is correct. 8. [4%] Refer to the table below. Minutes Needed to Make 1 Bushel of Pound of Wheat Beef Andia 20 12 Zardia 15 10 Assume that Andia and Zardia e...
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