If the percentage change in price is 20 and the percentage change in quantity supplied is 10, supply is:
A. unaffected by price changes.
B. inelastic.
C. unit elastic.
D. elastic.
Answer: B
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Which of the following is an example of a positive, as opposed to normative, statement?
a. Inflation is more harmful to the economy than unemployment is. b. If welfare payments increase, the world will be a better place. c. Prices rise when the government prints too much money. d. When public policies are evaluated, the benefits to the economy of improved equality should be considered more important than the costs of reduced efficiency.
At which point in Figure 9-7 would a perfectly competitive firm earn the same profit, or suffer the same loss, by producing rather than by shutting down?
a.
A
b.
B
c.
C
d.
D
e.
F
Table 12-1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units. Refer to Table 12-1. What is the fixed cost of production?
A. $500 B. $0 C. $500 D. $1,000 E. It cannot be determined
The IS curve will shift down and to the left when
A. desired saving declines. B. consumption increases. C. the expected future marginal product of capital declines. D. government purchases increase.