To say that demand is inelastic means that
A) people do not like the good very much.
B) quantity demanded not very responsive to price changes.
C) relatively small changes in price lead to relatively large changes in quantity demanded.
D) relatively small changes in quantity demanded lead to relatively small changes in price.
B
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All of the following describe the market for credit default swaps on mortgage-backed securities in the mid-2000s EXCEPT
A) an increasing number of buyers were speculators. B) AIG apparently underestimated the risk involved with mortgage-backed securities. C) the volume of credit default swaps was too low making it difficult to assess their value. D) payments by buyers were too low relative to risk.
Economic profit always exceeds accounting profit
a. True b. False Indicate whether the statement is true or false
By convention, there are two major divisions of economics, called:
A. rational economics and irrational economics. B. marginal benefit and marginal cost. C. microeconomics and macroeconomics. D. reservation price and opportunity cost.
Exhibit 2-19 Production possibilities curves
In Exhibit 2-19, the production possibilities curves for a country are shown for the years Year X and Year Y. Suppose this country was located at point A in Year X and would like to get to point B in Year Y. Construct a plan this country to activate in Year X to achieve this growth.
A. Eliminate unemployment, improve production technology, and acquire additional resources. B. Produce more consumption goods, eliminate unemployment, and reduce inefficiency. C. Reduce inefficiency, shift energy sources, and hold technology fixed. D. It is impossible for this country to achieve point B in Year Y.