Trade creation allows consumers access to more goods at a lower price than would have been possible without integration.
a. true
b. false
a. true
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If the quantity demanded of hamburgers increases by 20 percent when the price decreases by 5 percent, then the price elasticity of demand is
A) 0.25. B) 4.0. C) 20.0. D) 5.0.
In a Keynesian model, a temporary increase in government purchases would cause output to ________ and the domestic real interest rate to ________, in the short run
A) remain unchanged; increase B) remain unchanged; decrease C) increase; increase D) increase; decrease
A monopolist finds the output (Q*) rate that maximizes profit. It finds the price by
A) taking the height of the marginal revenue curve at output rate Q*. B) taking the height of the marginal cost curve at output rate Q*. C) taking the height of the demand curve at output rate Q*. D) setting price equal to marginal cost.
If the expected inflation rate is 4 percent and the nominal interest rate is 9 percent, the expected real interest rate is _____
a. 13 percent b. ?5 percent c. 9 percent d. ?13 percent e. 5 percent