Lauren has a savings account into which she puts money every month so she will eventually have enough for a down payment on a house. This is an example of which function of money?
a) Barter
b) Medium of exchange
c) Store of value
d) Unit of account
Ans: c) Store of value
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Economists compute the price elasticity of demand as the
a. percentage change in price divided by the percentage change in quantity demanded. b. change in quantity demanded divided by the change in the price. c. percentage change in quantity demanded divided by the percentage change in price. d. percentage change in quantity demanded divided by the percentage change in income.
Which of the following is a positive economic statement?
a. A tax on butter will reduce the quantity of butter sold. b. The rich do not pay enough in taxes. c. People in poor countries should not work for less than $5 per hour. d. All of the above are positive economic statements.
Suppose the president of country A opens this economy to trade with the rest of the world in 2010. Furthermore, suppose that the investment demand is the same as in 2009. Now, instead of being provided the equilibrium level of SP, we are provided with the SP curve: r =0.025+0.000025Q, where r is still the real interest rate. We are also told that the capital inflow equals $200 billion in 2010. For this part of the problem assumed that the government has a balanced budget in the year 2010. Compute the new equilibrium quantity of LF demanded or supplied, and the equilibrium real interest rate in the year of 2010
What will be an ideal response?
Since a monopoly faces a downward-sloping demand curve,
a. then, as Adam Smith wrote, "the price of monopoly is upon every occasion the highest which can be got." b. price always exceeds average revenue. c. marginal revenue increases as output increases. d. the monopolist is a price maker.