The actual value of price elasticity of demand
A) measures the relative change in quantity demanded when there is a change in price.
B) will change when the units good is measured in changes.
C) varies with changes in supply.
D) is always negative.
Answer: D
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According to the textbook, government price controls fail because:
A. legislation cannot alter basic economic incentives. B. firms ignore the price controls. C. they are not enforced by government. D. bureaucrats lack accurate market data.
Which of the following statements best describes the reaction of the private sector to government budget deficits and surpluses?
a. In practice, the private sector only sometimes adjusts its savings behavior to offset government budget deficits and surpluses. b. In practice, the private sector only partially adjusts its savings behavior to offset government budget deficits and surpluses. c. In practice, the private sector only sometimes and partially adjusts its savings behavior to offset government budget deficits and surpluses. d. In practice, the private sector does not adjust its savings behavior to offset government budget deficits and surpluses.
MacDougall showed in his tests that
A) relatively higher U.S. labor productivity was associated with relatively higher U.K. export ratios. B) relatively higher U.K. labor productivity was associated with relatively higher U.K. export ratios. C) labor productivity ratios and export ratios were not associated with each other. D) None of the above.
If the expenditure schedule must be shifted upward to reach potential GDP, then the economy is experiencing a(n)
A. inflationary gap. B. precautionary gap. C. recessionary gap. D. expansionary gap.