Suppose Sandy's Candies wants to increase its total revenues. If Sandy increases the price of her candy, she must be assuming that the demand for candy is
A) unit elastic.
B) inelastic.
C) elastic.
D) income elastic.
B
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Which of the following is an example of an external cost?
A) a grove of trees planted in a park in Seattle B) a library built in Philadelphia C) a new, faster computer chip D) an oil spill off the coast of South America E) a student graduating from college
According to your authors, a recessionary "bust" is
A) an inherent part of any market economy. B) a correction of the mistakes generated during the prior expansionary "boom." C) an event that can be successfully recovered through fiscal "stimulus" policies. D) identified by a rise in real GDP.
Indifference curves:
a. may sometimes intersect. b. are contour lines only of a linear utility function. c. are convex if the utility function is quasi-concave. d. shift when prices change.
Some economists believe that permanently lower marginal income tax rates __________ the incentive to work and thus shift the __________
A) increase; LRAS curve to the right B) increase; AD curve to the right C) increase; SRAS curve to the left D) decrease; LRAS curve to the right E) decrease; AD curve to the left