Suppose the price elasticity coefficients of demand are 1.43, 0.67, 1.11, and 0.29 for products W, X, Y, and Z, respectively. A 1 percent decrease in price will increase total revenue in the cases of
A. Y and Z.
B. W and Y.
C. X and Z.
D. Z and W.
Answer: B. W and Y.
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Smart Sam can make a $200 investment that yields $1000 50% of the time and $0 50% of the time. What is his expected return on the investment?
a. $200 b. $300 c. $400 d. $500
The value added at all stages of production sums to the market value of the final good, and the value added for all final goods sums to GDP based on the income approach
a. True b. False Indicate whether the statement is true or false
The exchange rate is
a. the rate at which one currency is traded for another b. always constant c. the tax a foreign nation imposes to change its currency into dollars d. irrelevant to those who do not travel to foreign countries e. controlled by the Federal Reserve
Fractional reserve banking is a term used to describe a banking system whereby
A) individual banks share a fraction of the total funds deposited in the whole banking system. B) banks are required to quote interest rates in fractions. C) banks hold reserves equal to only a fraction of their deposit liabilities. D) banks hold reserves equal to a multiple of their deposit liabilities; that is, fractional in this case really means multiple. E) banks are required to maintain a certain fraction of their deposits in the form of checkable deposits, a certain fraction of their deposits in the form of savings deposits, etc.