When demand is unit elastic, a 7 percent change in the price of the good
A. will cause a change in quantity demanded greater than 7 percent.
B. will not cause any change in quantity demanded.
C. will cause a change in quantity demanded equal to 7 percent.
D. will cause a change in quantity demanded of less than 7 percent.
Answer: C
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When a country has a negative current account, that country is
A) borrowing from the rest of the world. B) lending to the rest of the world. C) running a government budget surplus. D) None of the above is correct.
Assume the output market adjusts more rapidly than the asset market. A point of disequilibrium that is below both AA and DD will therefore initially result in
A) an increase in output. B) a decrease in output. C) a contraction of the money supply. D) a depreciation of the home currency. E) an appreciation of the home currency.
In Brinley Thomas' (1954) theory of the Atlantic Economy,
(a) cotton exports to Europe drove the growth of the U.S. economy. (b) people and capital moved to the U.S. when U.S. economic growth was strong. (c) the peaks of the U.S. business cycle were closely aligned with that of European peaks. (d) all of the above are true.
A monopolistic competitor is like a monopolist in that: a. it sells in the inelastic portion of its demand curve. b. it earns zero economic profit in the long run
c. the marginal revenue curve lies above the AR curve. d. it faces a downward-sloping demand curve.