The slope of the demand curve and the price elasticity of demand are
a. basically the same thing
b. determined by supply
c. are derived from production and distribution costs
d. different because slope is based on absolute changes and elasticity is based on percentage changes
e. implicit in the shape of the supply curve
D
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The Ricardian equivalence theorem states that
A. increases in government spending have a larger impact on real Gross Domestic Product (GDP) than decreases in taxes. B. an increase in the government budget deficit has no effect on real Gross Domestic Product (GDP) because it only affects the price index. C. an increase in government spending has no effect on aggregate supply. D. an increase in the government budget deficit created by a current tax cut has no effect on aggregate demand.
When bond prices go up, interest rates
A. go up. B. stay the same. C. go down. D. may go up, stay the same, or go down.
The figure above illustrates the effect of an increased rate of money supply growth at time period T0. From the figure, one can conclude that the
A) liquidity effect is smaller than the expected inflation effect and interest rates adjust quickly to changes in expected inflation. B) liquidity effect is larger than the expected inflation effect and interest rates adjust quickly to changes in expected inflation. C) liquidity effect is larger than the expected inflation effect and interest rates adjust slowly to changes in expected inflation. D) liquidity effect is smaller than the expected inflation effect and interest rates adjust slowly to changes in expected inflation.
Jane is a dietician in a city that twenty years ago voted to restrict the number of dieticians in the city to five and to regulate their prices
Although the city has tripled in size during that time (and thus demand has increased), no new dietician licenses have been issued. Over the years Jane and the other license holders have begun offering a wide variety of perks to their clients to maintain market share. It is clear that the initial restriction on licenses gave Jane a _____. a. monopoly b. transitional gain c. transitional loss d. sense of security