Assume the income elasticity of a good has been calculated to be +0.83. Based on this information, we can infer that the good is:
A) a normal good and a luxury.
B) an inferior good and a necessity.
C) a normal good and a necessity.
D) an inferior good and a luxury.
C
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A system of managed floating exchange rates is
A) a system in which governments may attempt to moderate exchange rate movements without keeping exchange rates rigidly fixed. B) a system in which governments use flexible exchange rates. C) a system in which governments are forbidden from attempt to moderate exchange rate movements without keeping exchange rates rigidly fixed. D) a system in which governments need to reach a prior agreement among them before they may attempt to moderate exchange rate movements without keeping exchange rates rigidly fixed. E) a system in which governments use extensive fiscal policy to discourage exchange rate movements.
Which of the following will not shift the demand curve for a good?
A) an increase in population B) an increase in the price of the good C) a decrease in the price of a substitute good D) an increase in consumer incomes
Firms react to unplanned increases in inventories by
A. increasing output. B. reducing output. C. increasing consumption. D. increasing planned investment.
Refer to the diagram. Constant returns to scale:
A. occur over the 0Q 1 range of output.
B. occur over the Q 1 Q 3 range of output.
C. begin at output Q 3 .
D. are in evidence at all output levels.