The price elasticity of demand for a rental home in Luxury Resorts in the summer is 1.25 and is 2.25 in the spring. If Luxury Resorts faces a constant marginal cost of $500 per home rental, what is the profit-maximizing off-peak load price to charge in the spring?
A) $1,250 B) $500 C) $2,500 D) $900
D) $900
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Everything else equal, an appreciation of the dollar against the yuan:
A) will lead to a decrease in the quantity of dollars demanded. B) will lead to an increase in the quantity of dollars demanded. C) will not affect the quantity of dollars demanded. D) can either lead to an increase or a decrease in the quantity of dollars demanded depending on the magnitude of the appreciation.
The figure above illustrates a rental housing market in which there is a rent ceiling of $400 a month. The rent ceiling is strictly enforced. The number of apartments rented is
A) less than 2 thousand. B) 2 thousand. C) 3 thousand. D) 4 thousand.
Competition in U.S. banking has been increased by
a. the expansion of interstate banking. b. the expansion of foreign bank branches into the United States. c. the movement of brokerage houses and large corporations into traditional banking activities. d. All of these.
Suppose that Canada decides to peg its dollar ($C, or the loonie) to the U.S. dollar at an exchange rate of $C1 = $US1. Now suppose that the increase in the price of oil in the second half of 2007 causes the IS curve in the United States to shift to the left. If all other things remain unchanged, what will happen to U.S. interest rates?
A) They will rise. B) They will fall. C) They will not change. D) They will rise dramatically.