Ceteris paribus, which of the following would you expect to have no effect on the demand curve for new automobiles?
A. An increase in the price of new automobiles.
B. Consumer expectations that the price of new automobiles will be lower next year.
C. Consumer expectations that a significant recession will develop and last for a year.
D. A rise in the price of gasoline.
Answer: A
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All of the following are included in gross private domestic investment expenditure EXCEPT a
A) business's purchase of a fleet of cars. B) household's purchase of a new house. C) business's purchase of another company's stock. D) a retail store's purchase of shoes to add to its inventory.
If a 20 percent increase in the price of a used car results in a 10 percent decrease in the quantity of used cars demanded, then the demand for used cars is
A) elastic. B) inelastic. C) unit elastic. D) arc elastic.
Suppose when the price of hybrid automobiles rises, consumers buy fewer hybrid automobiles. This implies that
A) there is a direct relationship between hybrid automobile prices and quantities purchased by consumers. B) there is a one-to-one relationship between hybrid automobile prices and quantities purchased by consumers. C) there is a positive relationship between hybrid automobile prices and quantities purchased by consumers. D) there is a negative relationship between hybrid automobile prices and quantities purchased by consumers.
Jessica owns a company that makes pre-packaged sandwiches for convenience stores. The market price for a sandwich is $5 and Jessica is a price-taker. Her daily cost for making sandwiches is C(Q) = 2.5Q + (Q2/40) and her marginal cost is MC = 2.5 + (Q/20). How many sandwiches should Jessica produce each day?
A. 20 B. 40 C. 45 D. 50