If the absolute price elasticity of demand for automobiles is equal to 1.25, we say
A. that there is no responsiveness of quantity demanded to automobiles price cuts.
B. that demand is elastic.
C. that demand is inelastic.
D. none of these is correct.
Answer: B
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If the money wage rate increases, the short-run aggregate supply curve shifts rightward
Indicate whether the statement is true or false
The soil of the Middle Colonies is generally:
a. rocky and sandy. b. fertile and difficult to till. c. fertile and easy to till. d. alkaline and poorly drained.
A firm that produces and sells furniture gets to choose
a. how many workers to hire in both the short run and the long run. b. the size of its factories in the short run but not in the long run. c. which short-run average-total-cost curve to use in both the short tun and the long run. d. All of the above are correct.
Demand is (more elastic / less elastic) in the short run than in the long run
A. (less elastic) because goods account for a smaller percentage of the consumer's budget in the short run than in the long run. B. (less elastic) because consumers have less time to adapt to a price change in the short run than in the long run. C. (more elastic) because consumers have less time to adapt to a price change in the short run than in the long run. D. (more elastic) because goods account for a larger percentage of the consumer's budget in the short run than in the long run.