The price elasticity of demand for a good is influenced by which of the following factors?
a. the responsiveness to changes in income
b. the cost of resources to produce the good
c. the availability of substitutes
d. the level of competition among sellers
e. the number of uses for the good
C
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If Project X has a cost of $6 and provides a benefit of $10, and Project Y has a cost of $25 and provides a benefit of $27, which of the following statements is true?
A) An individual can optimize by choosing Project X. B) An individual can optimize by choosing Project Y. C) Switching from Project X to Project Y increases net benefit by $2. D) Switching from Project Y to Project X decreases net benefit by $2.
Suppose that Argentina's dollar-denominated external assets and liabilities are $10 billion and $100 billion, respectively, and its Argentine peso-denominated external assets and liabilities are each 50 billion pesos (P). Suppose further that Argentina fixes its exchange rate at P1 = $US1. What is the likely effect of the change in Argentina's external wealth on Argentine aggregate demand as a result of the devaluation of the peso (from P1 = $US1 to P3 = $US1)?
A) It will increase Argentine aggregate demand. B) It will decrease Argentine aggregate demand. C) It will neither increase nor decrease Argentine aggregate demand. D) It will first increase, then decrease Argentine aggregate demand.
Which of the following is credited with making the greatest contribution to economic growth over time for the United States?
A. Improved management techniques. B. Investment in capital. C. Research and development. D. Increased education.
Suppose Blu-ray discs are sold in a perfectly competitive market. The current market price of Blu-ray discs is $15. If at the current level of production of compact discs you calculate the marginal cost to your company is also $15, and that AVC is rising, in the short run your company should:
A. produce more Blu-ray discs. B. produce fewer Blu-ray discs. C. continue producing the current level of Blu-ray discs. D. raise the price of its Blu-ray discs.