A negative income elasticity of demand coefficient indicates that:
A. The product is an inferior good
B. The product follows the law of demand
C. The product is a complementary good
D. The product is a substitute good
A. The product is an inferior good
You might also like to view...
Refer to Table 4-4. Suppose that the quantity of labor supplied decreases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?
A) W = $9.00; Q = 330,000 B) W = $8.00; Q = 390,000 C) W = $10.00; Q = 350,000 D) W = $9.50; Q = 370,000
The nation closest to a centrally planned, socialist economy is
A. China. B. Japan. C. the United States. D. Norway.
The PPF of a country will be skewed toward the good that:
A. uses its scarce factor intensively. B. uses its abundant factor intensively. C. uses its intensive factor abundantly. D. does not use its intensive factor abundantly.
Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher