Which of the following statements is? true?
A. The longer any price change? persists, the greater the elasticity of demand.
B. The closer the substitutes for a particular commodity and the more substitutes there? are, the more inelastic will be its price elasticity of demand.
C. The smaller the share of a? person's total budget that is spent on a? commodity, the greater that? person's price elasticity of demand is for that commodity.
D. The demand for necessities is likely to be? elastic, while the demand for luxuries is likely to be inelastic.
Ans: A. The longer any price change? persists, the greater the elasticity of demand.
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Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Firm X ($/day)$500$514$530$555$585Cost to Firm Y ($/day)$400$420$445$480$520Cost to Firm Z ($/day)$300$325$360$400$550 Suppose the government requires each firm to reduce pollution to 2 tons of smoke per day, so that total daily smoke emission is 6 tons. The total cost to society of this policy will be ________ per day.
A. $59 B. $135 C. $230 D. $42
If the price level in the United States falls relative to the price level in foreign nations, U.S. exports:
A. increase and U.S. imports decrease, causing the demand for dollars to fall and the supply of dollars to rise. B. decrease and U.S. imports decrease, causing the demand for dollars to rise and the supply of dollars to rise. C. decrease and U.S. imports increase, causing the demand for dollars to fall and the supply of dollars to rise. D. increase and U.S. imports decrease, causing the demand for dollars to rise and the supply of dollars to fall.
Publicly provided health insurance for the poor will
A. lower the price of health care to the non-poor. B. lower the price of health care to the non-poor and decrease the total amount of health care consumed. C. decrease the total amount of health care consumed. D. raise the level of health care consumed by the poor.
________ fixed the exchange rates of Germany, France, Italy, the Netherlands, Belgium, Denmark, Ireland, and Luxembourg beginning in 1979.
A. A currency board B. The International Monetary Fund C. The European Central Bank D. The Exchange Rate Mechanism