Medical authorities announced in the late 1980s that an acne ...

[Pineapplelove6]

Medical authorities announced in the late 1980s that an acne medicine named Retin-A also had previously unknown wrinkle-reducing properties. An economist would expect to find that, after this announcement, the price of Retin-A ____ and the quantity sold ____.
 a. rose; fell
 b. rose; rose
  c. fell; fell
 d. fell; rose

Question 2

If there is initially a federal budget deficit, and taxes fall while transfer payments rise:
 a. there is an indeterminate effect on both AD and the budget deficit.
  b. AD increases and the budget deficit increases.
 c. AD increases and the budget deficit decreases.
 d. AD decreases and the budget deficit increases.

[kkenney]

Answer to Question 1

b

Answer to Question 2

b

[Pineapplelove6]

Excellent

[Dnite]

Gracias!