Supply is very inelastic if the quantity supplied cannot respond quickly to an increase in price.
Answer the following statement true (T) or false (F)
True
It is true that inelastic supply indicates that producers cannot quickly increase production after a price increase. An inelastic supply curve is very steep. This means even though price is rising, quantity supplied increases slightly.
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When lenders are unable to get good information about the worthiness of a project the lender has the problem of
A) adverse selection. B) moral selection. C) moral hazard. D) adverse hazard.
All of the following statements are true regarding voluntary production reduction programs EXCEPT
A. they offer firms incentives to reduce their production voluntarily. B. they include payments to producers who reduce production. C. they are an attempt to limit supply. D. they are an attempt to protect consumers from high prices.
Forming a cartel is illegal in _____
a. the United States b. Canada c. India d. Australia
The discount rate is
a. the rate at which public banks lend to other public banks. b. the rate at which the Fed lends to banks. c. the percentage difference between the face value of a Treasury bond and what the Fed pays for it. d. the percentage of deposits banks hold as excess reserves.