Refer to the graphs below of D and MR for a monopolist. Which of the following statements is true?
A. A price cut from P1 to P2 would lead to a decrease in consumer spending on the product
B. A price cut from P1 to P2 would lead to an increase in consumer spending on the product
C. A price cut from P2 to P3 would lead to no change in consumer spending on the product
D. A price cut from P2 to P3 would lead to an increase in consumer spending on the product
B. A price cut from P1 to P2 would lead to an increase in consumer spending on the product
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The real exchange rate:
A. expresses the value of goods in one country in terms of the same goods in another country. B. is the nominal exchange rate adjusted for purchasing power parity. C. uses the price level in each country to convert the exchange rate into a value that is in "real" terms. D. All of these statements are true.
When a price floor is above the equilibrium price,
a. quantity demanded will exceed quantity supplied, so there will be a shortage. b. quantity supplied will exceed quantity demanded, so there will be a surplus. c. the market will be in equilibrium. d. This is a trick question because price floors are generally set below the equilibrium price.
If the marginal propensity to consume (MPC) is less than 1 and a household's disposable income increases by $2,000, the household's consumption will _____
Fill in the blank(s) with the appropriate word(s).
Product demand is more elastic the longer the time period under consideration.
Answer the following statement true (T) or false (F)