This year Gus purchased a used 1972 vehicle from Wee-Rob-U Auto Sales. The dealer paid $500 for it yesterday, and sold it to Gus for $3500. In principle, what happens to GDP?
A) Nothing, because the vehicle was already accounted for in 1972.
B) Nothing, because Gus was ripped off.
C) It increases by $3000.
D) It increases by $3,500.
E) It increases by $6,500.
C
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If price discrimination occurs in a market
A) consumers whose demand for the product sold is more elastic pay higher prices than consumers whose demand is less elastic. B) the firm earns arbitrage profits. C) the marginal cost of production is constant. D) the law of one price does not hold.
According to the law of supply, when the price of computer microprocessors rises Question 13 options:
A. the quantity of microprocessors produced increases. B. the number of sellers of microprocessors increases. C. the supply of microprocessors increases. D. the quantity of microprocessors produced decreases. E. computers become cheaper to purchase.
Refer to the below graph. Consider a situation where price increases from P3 to P4. In this price range, demand is relatively:
A. Inelastic because the loss in total revenue (areas E + F + G) is greater than the gain in total revenue (area A)
B. Elastic because the loss in total revenue (areas E + F + G) is greater than the gain in total revenue (area A)
C. Elastic because the loss in total revenue (area A) is greater than the gain in total revenue (areas E + F + G)
D. Inelastic because the loss in total revenue (area A) is greater than the gain in total revenue (areas E + F + G)
Suppose the economy is experiencing inflation. What would be the interpretation of how a restrictive monetary policy would address this problem?
What will be an ideal response?