If a 1 percent decrease in the price of one good generates a 3 percent increase in the quantity demanded for another good, then the
a. two goods are complementary
b. cross elasticity between the two goods is positive
c. two goods are substitutes
d. price elasticity of demand for the good whose quantity demanded increased must be inelastic
e. price elasticity of demand for the good whose quantity demanded increased must be elastic
A
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In a budget line/indifference curve diagram, at the consumer equilibrium
A) any movement upward or downward on the budget line will move the consumer to a less preferred point. B) any movement to the northeast to higher indifference curves moves the consumer to a less preferred point. C) the slope of the budget line is as much larger as possible than the marginal rate of substitution. D) All of the above statements are correct.
Marginal cost is the
A. change in total cost resulting from the purchase of one more unit of the variable input. B. change in total cost resulting from the production of one more unit of output. C. difference between total fixed cost and total variable cost. D. difference between total cost and total expenditure.
Macroeconomics stresses
A. resource allocation and income distribution. B. inflation and unemployment. C. resource allocation and inflation. D. unemployment and income distribution.
Unexpected high inflation redistributes wealth from:
A. those who save to those who borrow. B. those who borrow to those who save. C. those who borrow to banks. D. banks to those who save.