When the absolute percentage change in quantity demanded is just equal to the percentage change in price, demand is
A) elastic.
B) perfectly inelastic.
C) unit-elastic.
D) relatively inelastic.
Answer: C
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If a 5 percent decrease in income leads to a 15 percent decrease in the demand for a good, the income elasticity of demand equals
A) -1/3 and the good is an inferior good. B) 1/3 and demand for the good is income elastic. C) 3 and the good is a normal good. D) -3 and the demand for the good is income inelastic. E) 3 and the good is an inferior good.
In addition to the extreme conventional macropolicy measures implemented by the Federal Reserve, Congress, and the Administration to recover from the Great Recession, unprecedented financial measures were carried out by ___________ ____________, ____________, and _____ __________ to stave off the financial meltdown.
Fill in the blank(s) with the appropriate word(s).
Exhibit 11-4 Supply and demand curves for food servers
In Exhibit 11-4, suppose that in the interest of boosting incomes of the working poor, Congress imposes a minimum wage of $6.00 per hour. This minimum wage rate creates a(n):
A. new labor market equilibrium. B. excess demand for labor of 10 thousand food servers. C. excess supply of labor of food servers. D. situation of full employment for food servers.
Cost-push inflation arises from:
A. an increase in aggregate supply. B. a decrease in aggregate demand. C. a decrease in aggregate supply. D. an increase in aggregate demand.