Answer the following questions true (T) or false (F)
1. One possible reason as to why consumers respond to sales is that by displaying a "high" regular price and a "low" sale price, sales provide consumers with a reference point to interpret the prices being offered.
2. The demand for gasoline is perfectly inelastic because most people need gasoline to drive their cars.
3. If the demand for a product is elastic, the quantity demanded changes by a larger percentage than the percentage change in price.
1. TRUE
2. FALSE
3. TRUE
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Surveys show that a small increase in the price of organic potatoes will cause most people to switch to other alternatives such as packaged mashed potatoes. This finding suggests that the demand curve for organic potatoes is
a. relatively steep. b. relatively flat. c. upward sloping. d. vertical.
Refer to Table 2.4. Increasing the tanks of fertilizer from 3 to 4 will increase the truckloads of potatoes by
A) 152. B) 35. C) 17. D) 11.
If the Federal Reserve targets the money supply, and the money demand curve shifts to the left, then the Fed
A) can maintain the money supply target, but at a lower interest rate. B) can maintain the money supply target with no change in the interest rate. C) can maintain the money supply target, but at a higher interest rate. D) cannot maintain the money supply target.
The closer the Lorenz curve is to the diagonal, the more unequal the distribution of income
Indicate whether the statement is true or false