If an increase in the price of a product from $100 to $200 per unit leads to a decrease in the quantity demanded from 10 to 8 units, then demand is
a. elastic
b. inelastic
c. unit elastic
d. 0
e. inferior
B
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Which of the following statements is true?
A) Both efficiency wages and minimum wages increase unemployment. B) Efficiency wages increase unemployment while minimum wages help reduce unemployment. C) Both efficiency wages and minimum wages help reduce unemployment. D) Efficiency wages help reduce unemployment while minimum wages increase unemployment.
Early attempts to establish paper money were hampered by:
a. counterfeiting. b. constitutional prohibition against states issuing paper money. c. currency valuations that varied from city to city. d. All of the above are correct. e. Only a and c are correct.
Economic efficiency indicates that
a. if something is worth doing, you should do it as well as humanly possible. b. all pollution should be eliminated. c. automobiles should be made as safe as possible d. it nearly always makes sense to stop an activity well before perfection is achieved.
According to the optimal output rule, if marginal benefit:
a. exceeds marginal cost, an activity should be reduced. b. is less than marginal cost, an activity should be reduced. c. is equal to marginal cost, an activity should be reduced. d. exceeds marginal cost, net benefit is maximized.