The demand for normal goods follows the law of demand because of
A. risk-aversion by consumers.
B. the income effect only.
C. the substitution effect only.
D. both the substitution and income effects.
Answer: D
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Refer to the table above. If, at a price of $4 per loaf, the market supply of bread is 75 loaves, Seller 2's supply is:
A) 30 units. B) 35 units. C) 55 units. D) 20 units.
How did the global savings glut in the 2000s affect the U.S. current account balance?
A) It caused it to decline by increasing the value of the dollar. B) It caused it to decline by reducing the value of the dollar. C) It caused it to increase by increasing the value of the dollar. D) It caused it to increase by reducing the value of the dollar.
A nation's international investment position shows its stock of international assets and liabilities at a point in time.
Answer the following statement true (T) or false (F)
If the supply of oranges is unit elastic, the price elasticity of supply of oranges is
A. 1.0. B. 0.0. C. -1.0. D. -100.0.