Along a straight-line demand curve, as the price falls the
A) demand becomes more elastic.
B) demand becomes less elastic.
C) elasticity of demand is constant.
D) demand is always unitary elastic.
B
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iTunes offers samples of music downloads, and in doing so they
A) further inform customers. B) further reduce customer search costs. C) further expand the range of opportunities available to customers. D) do all of the above.
Consumer spending is spending by ________ households on final goods and services produced ________
A) domestic; domestically and abroad B) domestic; domestically C) domestic and foreign; domestically and abroad D) domestic and foreign; domestically
The long-run cumulative dynamic multiplier
A) cannot be calculated since in the long-run, we are all dead. B) is the sum of all individual dynamic multipliers. C) is the coefficient on Xt-r in the standard formulation of the distributed lag model. D) is the difference between the coefficient on Xt-1 and Xt-r.
Which of the following statements is correct? I. When economists derive the aggregate demand curve, they are looking at the effect of the price level on one commodity only. II. Any non-price-level change that increases total planned real spending on domestic goods shifts the AD curve to the right.
A. I only B. II only C. Both I and II D. Neither I or II