What does cross elasticity of demand between goods reveal about the nature of relationship between them?
What will be an ideal response?
Its sign reveals whether the goods are substitutes or complements. If the two goods are substitutes, their cross elasticities of demand will normally be positive. The cross elasticities of demand for complement goods will normally be negative.
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An overvalued exchange rate is an exchange rate:
A. at which the quantities of currencies demanded and supplied in the foreign exchange market are equal. B. that equals the number of units of a foreign currency over the number of units of domestic currency. C. that has an officially fixed value less than its fundamental value. D. that has an officially fixed value greater than its fundamental value.
According to this Application, the longer than usual harmattan has impacted the supply curve for cocoa pods, shifting the supply curve to the ________ due to a(n) ________ in cocoa yields
A) right; decrease B) left; decrease C) right; increase D) left; increase
Define the terms of trade
What will be an ideal response?
Which of the following helps in determining whether health care cost rises because of government policy, or because of demand rising faster than supply?
a. Examining the market for health care away from the belief that the market outcome is unfair b. Examining the market for health care with the belief that the market outcome is unfair c. Examining the allocation system d. Examining the changes in the price of health care products e. Examining the changes in the number of suppliers of health care in the market