Price elasticity of demand is measured by the percentage change in
a. income divide by the percentage change in price
b. quantity demanded divided by the percentage change in income
c. price divided by the percentage change in quantity demanded
d. quantity demanded divided by the percentage change in price
e. total revenue divided by percentage change in price
D
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Other things constant, the demand for an inferior good will decrease (the demand curve will shift left) if
A) the price of a complementary good decreases. B) the price of a substitute good increases. C) income increases. D) income decreases.
Examine the two figures below. Which illustrates a society that produces more capital goods than consumer goods?
What will be an ideal response?
An act of production, as economists use the term, is demonstrated by which of the following?
A. An individual buys municipal bonds to avoid taxes. B. A firm buys a pre-existing building in order to expand its operations. C. A worker places money in a pension fund. D. A local nonprofessional theater company performs a play.
How much is induced consumption when disposable income is $10 billion?
