Assume that product X has a negative cross elasticity with respect to shoes. If the price of shoes rises
A) the demand for product X will decrease.
B) the quantity demanded for product X will increase.
C) the demand for shoes will fall.
D) the demand for product X will increase.
A
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If the opportunity cost of producing cheese is higher in Greece than it is in Italy, then:
a. Greece should specialize in producing cheese. b. Italy should specialize in producing cheese. c. both Greece and Italy should produce cheese. d. Greece gives up fewer goods to produce cheese than Italy does. e. Italy has a better economy than Greece.
Opportunistic behavior on the part of the employer is possible because:
a. contracts are often incomplete and leave room for implicit understandings between the two parties. b. employees often reduce their effort level if they are important to the company. c. it is difficult to monitor all employees and their performances. d. good quality work can be easily measured.
Which of the following generates allocative efficiency in a market economy?
A) national government intervention B) voluntary exchange between buyers and sellers C) United Nations rules for competition D) equity
After the September 11, 2001 terrorist attacks, federal government spending
A. increased at a rate much faster than it had before the attacks. B. increased, but at a rate much slower than it had before the attacks. C. increased, but at a rate almost exactly the same as it had before the attacks. D. was cut.