At a price of $5, quantity demanded is 70; and at a price of $7, quantity demanded is 50. Since total revenue ________ by the price increase, demand must be ________.
A. is unchanged; elastic
B. is increased; elastic
C. is decreased; inelastic
D. is unchanged; unit elastic
Answer: D
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In the foreign exchange market, the demand for dollars decreases and the demand curve shifts leftward if the
A) U.S. interest rate differential increases. B) U.S. exchange rate falls. C) U.S. interest rate differential decreases. D) U.S. exchange rate rises. E) expected future exchange rate rises.
The assumption that individuals will not intentionally make decisions that will leave them worse off is known as
A) microeconomic analysis. B) macroeconomic analysis. C) a model or theory. D) the rationality assumption.
If Freedonia changes its laws to allow international trade in software and the world price is lower than its domestic price, then it must be the case that
a. both consumer surplus and producer surplus increase. b. consumer surplus increases and producer surplus decreases. c. consumer surplus decreases and producer surplus increases. d. both consumer surplus and producer surplus decrease.
A U.S.-imposed quota on automobiles would shift
a. both the demand and supply curves in the market for foreign-currency exchange right. b. both the demand and supply curves in the market for foreign-currency exchange right. c. only the demand curve in the market for foreign-currency exchange right. d. only the supply curve in the market for foreign-currency exchange right.