When the price of chai tea lattés is $5, Maxine buys 20 per month. When the price is $4, she buys 30 per month. Maxine's demand for chai tea lattés is
a. elastic, and her demand curve would be relatively flat.
b. elastic, and her demand curve would be relatively steep.
c. inelastic, and her demand curve would be relatively flat.
d. inelastic, and her demand curve would be relatively steep.
a
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According to the Coase theorem, externality problems may be solved if the parties involved can negotiate. Which of the following is also needed?
a. clearly defined bargaining costs b. enforceable bargaining costs c. clearly defined, enforceable property rights and low bargaining costs d. a property right that cannot be bought or sold e. government regulation
The consumer price index is subject to substitution bias because
a. some pairs of goods are complements rather than substitutes. b. some goods are inferior rather than normal. c. the law of demand applies to most, if not all, goods. d. the index does not take into account the likelihood that consumers substitute newly-introduced goods for more-established goods.
A higher real interest rate ________ saving and ________ consumption spending.
A. increases; decreases B. does not change; does not change C. increases; increases D. decreases; increases
If the price of output increases, the marginal revenue product curve will shift ________ and the profit maximizing quantity of labor demanded will ________.
A. up; increase B. up; decrease C. down; increase D. down; decrease