When the percentage change in price is greater than the corresponding change in quantity demanded, demand is inelastic
Indicate whether the statement is true or false
TRUE
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The desired reserve ratio is 10 percent. Joe deposits $1,000 in Bank A. Bank A keeps its minimum desired reserves and lends the excess to Fred
Fred spends his loan at J.C. Penney. J.C. Penney deposits the check it receives from Fred in Bank B. Bank B keeps its minimum desired reserves and lends the excess to Mary. How much can Bank B lend to Mary? A) $90 B) $900 C) $810 D) $1,000 E) $100
If the quantity demanded changes proportionately the same as price, demand is said to be
A) vertical. B) elastic. C) unit elastic D) inelastic.
A firm can find a competitive advantage
A) by differentiating its product. B) by having a barrier to entry. C) through its organizational structure. D) all of these choices.
The aggregate demand curve
a. slopes upward. b. slopes downward. c. is perfectly vertical. d. is perfectly horizontal.