Prices for airline tickets change on average about once per month. This would suggest that airline ticket prices are:
A. stuck.
B. determined in a highly competitive market.
C. relatively sticky.
D. relatively flexible.
Answer: D
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The value of marginal product (VMP) of labor is the extra revenue generated by
A) selling one additional unit of output. B) raising the price of the good by one dollar. C) hiring one additional unit of labor. D) price discrimination.
Under the least squares assumptions (zero conditional mean for the error term, Xi and Yi being i.i.d., and Xi and ui having finite fourth moments), the OLS estimator for the slope and intercept
A) has an exact normal distribution for n > 15. B) is BLUE. C) has a normal distribution even in small samples. D) is unbiased.
Exhibit 14A-2 Macro AD-AS Model
In Exhibit 14A-2, the long-run aggregate supply curve represents:
A. potential real GDP output for this economy. B. that the economy is experiencing zero inflation. C. that the economy is experiencing technological change. D. the level of real GDP where the unemployment rate is zero.
When the cross-price elasticity of demand for two goods is a positive number, one can correctly conclude that:
a. the goods are normal goods. b. the goods are inferior goods. c. the goods are substitutes. d. the goods are complements. e. total revenue will increase when the price increases.