The price of coffee rose 50 percent and coffee sales fell 25 percent. Doughnut sales also fell 25 percent. From this information, we can conclude that
A. demand for coffee is inelastic.
B. coffee and doughnuts are complements.
C. the cross elasticity of demand is minus 0.5 percent.
D. All of the responses are correct.
Answer: D
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The above table shows production combinations on a country's production possibilities frontier. What is the opportunity cost of one unit of Y when the production of good Y increases from 16 to 28 units?
A) 4 units of good X per unit of good Y B) 3 units of good X per unit of good Y C) 1/4 unit of good X per unit of good Y D) There is no opportunity cost when moving from one point to another along a production possibilities frontier.
Figure 5-11
In Figure 5-11, a consumer is initially at point A. There is a price change and she moves to B. It follows that
A. the demand for beer follows the law of demand. B. the demand for beer does not follow the law of demand. C. wine is an inferior good. D. the consumer is confused.
Consider the budget line in the above figure. If the consumer's income is $120, then the price of a movie is
A) $24 per movie. B) $12 per movie. C) $5 per movie. D) More information is needed to determine the price of a movie.
The table above shows Mary's utility from chips and soda. Mary receives ________ units of utility from the third chip
A) 30 B) 20 C) 55 D) 40