You are the manager of a Mom and Pop store that can buy milk from a supplier at $2.00 per gallon. If you believe the elasticity of demand for milk by customers at your store is ?3, then your profit-maximizing price is:
A. $3.00.
B. $2.75.
C. $4.50.
D. $1.33.
Answer: A
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Suppose that a new drug has been approved to treat a life-threatening disease. The demand for that drug is shown on the graph below. Prior to approval of this drug, the only treatment for this condition was any one of several non-prescription, or over-the-counter, pain relievers. The demand for one brand of the several non-prescription pain relievers is also shown on the graph. 
If the manufacturer of the new drug chose to increase its price from $70 to $75, consumers would buy ________ doses, and have ________ total expenditures.
A. more; higher B. more; lower C. fewer; higher D. fewer; lower
Refer to Table 20-15. Looking at the table above, real average hourly earnings were equal to ________ in 2015
A) $9 B) $9.52 C) $10 D) $12
Monetarists believe that changes in the money stock
a. have an immediate effect on the level of income. b. will always have a persistent impact on output for more than two years. c. do not affect the level of income to any great extent. d. have a persistent impact on output for as long as it takes the expected price level to adjust to the actual price level. e. both b and d.
An increase in the real interest rate will
What will be an ideal response?