Tennis balls and tennis rackets are complements. If a 3 percent change in the price of a tennis racket leads to a 9 change in the quantity of tennis balls demanded, the cross elasticity of demand equals
A) 3.
B) -3.
C) 1/3.
D) -1/3.
E) 9.
B
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How is a long-run average cost curve different from a short-run average cost curve? How are they related?
What will be an ideal response?
_____ is the decline in value over time of capital equipment
a. Bracket creep b. Inflation c. Depreciation d. Diminishing productivity
If pollution levels exceed the socially efficient level: a. the marginal cost of pollution abatement exceeds the marginal benefit of pollution abatement
b. the marginal cost of pollution abatement is less than the marginal benefit of pollution abatement. c. the marginal cost of pollution abatement equals the marginal benefit of pollution abatement. d. nothing can be said about the relationship between the marginal cost and marginal benefit of pollution abatement.
The AD curve shifts to the right when
a. the Fed alters its fiscal policy rules b. any economic shock disrupts the economy c. the AS curve does not shift d. new trade legislation is passed e. positive demand shocks occur