The production possibilities frontier slopes downward and to the right because of limited resources.
Answer the following statement true (T) or false (F)
True
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The cost of using a good for some specific period of time is called the ________ of the good
A) issue price B) rental price C) auction price D) market price
The above figure shows supply and demand curves for apartment units in a large city. If the city government passes a law that establishes $350 per month as the legal maximum rent, producer surplus
A) increases. B) decreases. C) stays the same. D) changes in a direction that cannot be determined from the information given.
If the price elasticity of demand is elastic, then:
a. Ed < 1. b. consumers are relatively not very responsive to a price increase. c. an increase in the price will increase total revenue. d. there are likely a large number of substitute products available.
The quantity theory of money assumes that
a. velocity varies inversely with interest rates. b. if velocity equals six, the Fed can increase nominal GDP by 30 percent if it increases the money supply by 5 percent. c. changes in the money supply affect output but not prices. d. changes in velocity are so small that velocity can be considered constant.