Other things being equal, demand is less elastic
A. the more substitutes a good has.
B. the more expensive the good is.
C. the longer is the time period for adjustment.
D. the smaller the percentage of a total budget that a family spends on a good.
Answer: D
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Scarcity exists because
A) society and people are greedy and wasteful. B) our wants exceed the resources available to satisfy them. C) of the inefficient choices we make. D) poor people need more food and other goods.
Which statement is true?
A. The entire expansion from the trough to the peak is the recovery phase. B. The entire contraction from the peak to the trough is the recession phase. C. Recessions never last more than one year. D. Prosperity is the first phase of expansion.
Average total cost is
A) total explicit costs divided by the quantity of output produced. B) total cost divided by the quantity of output produced. C) the change in fixed plus variable cost divided by the quantity of output produced. D) variable cost divided by the quantity of output produced.
A government can impose an import quota or an equivalent tariff that achieves the same impact on trade. What is the key difference in the welfare outcomes of these two policy options?
A) The domestic quantity supplied is larger under the tariff policy. B) The domestic price is higher under the tariff policy. C) The domestic price is lower under the tariff policy. D) The government captures some of the profits from foreign suppliers through the tariff revenue.