For substitutes, cross price elasticity of demand is:
a. Negative
b. Positive
c. between zero and one only
d. zero.
b
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If the supply of aisle seats equals the supply of middle seats on an airplane, and the demand for aisle seats is _____________ than the demand for middle seats, then the equilibrium price of aisle seats will be ______________ the equilibrium price of middle seats
A) greater; higher than B) less; higher than C) greater; lower than D) less; the same as
An economist would be more likely to argue for reducing inflation if she thought that
a. the central bank lacked credibility and if bonds were usually not indexed for inflation. b. the central bank lacked credibility and if bonds were usually indexed for inflation. c. the central bank had credibility and if bonds were usually not indexed for inflation. d. the central bank had credibility and if bonds were usually indexed for inflation.
Which of the following would be included in aggregate demand?
a) government's tax collections b) the quantity of services that firms sell c) firms' purchases of newly produced machinery d) the quantity of goods that firms produce
The maximum quantity of good Y that is affordable is:
A. M/PX. B. M/Y. C. M/X. D. M/PY.