If the cross elasticity of demand between car insurance and new cars is -0.41, then car insurance and new cars are
A) complements.
B) substitutes.
C) normal goods.
D) inferior goods.
E) unrelated goods.
A
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Refer to the graph shown. The line segment that represents average total costs of producing Q* is:
A. BQ*. B. CQ*. C. AQ*. D. AB.
Between 1836 and 1851 travel time between New York and Chicago was cut from
A. a month to two days. B. a month to a week. C. two weeks to one week. D. two weeks to two days.
Assume that because of a long policy lag, the Fed starts implementing expansionary monetary policy too late, i.e., at a time when the economy is already healing itself. As a result, the economy will probably move from an initial
A) recessionary gap to an even deeper recessionary gap. B) recessionary gap to an inflationary gap. C) inflationary gap to the natural level of Real GDP. D) inflationary gap to a recessionary gap.
The difference between the maximum a person is willing to pay and current market price is known as
A. consumer surplus. B. market surplus. C. producer surplus. D. nonprice surplus.