If the price of apples goes down, then the demand for pears will
A) increase, assuming apples and pears are substitutes.
B) decrease, assuming apples and pears are substitutes.
C) decrease, assuming apples and pears are complements.
D) remain constant, assuming apples and pears are related goods.
Answer: B
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What is the annual rate of growth of per capita real GDP if real GDP grows at a constant rate of 4 percent per year and the annual rate of population growth is 3 percent?
A) 1 percent B) 3 percent C) 87 percent D) 4 percent
If the income effect of a change in the wage dominates the substitution effect, then workers will want to work more when the wage increases
a. True b. False Indicate whether the statement is true or false
Suppose the price level rises, but the number of dollars you are paid per hour stays the same. This means that your
a. nominal wage is higher. b. nominal wage is lower. c. real wage is higher. d. real wage is lower.
Figure 7.4
The above figure represents the marginal utility per dollar for candy bars and oranges for Sophia. The price of each product is $0.50, and Sophia has a budget of $4.Refer to Figure 7.4. If Sophia goes from making her choice based on gut feeling to making her choice based on cognition, she will:
A. increase orange and candy bar consumption. B. decrease orange and candy bar consumption. C. increase candy bar consumption at the expense of orange consumption. D. increase orange consumption at the expense of candy bar consumption.