The price elasticity of new automobile purchases is about 1.2 . This implies that an increase of $1,000 on a $10,000 automobile will
a. reduce the number of autos sold by approximately 1.2 percent.
b. increase the consumer expenditures on autos by approximately 1.2 percent.
c. reduce the number of autos sold by approximately 12 percent.
d. increase consumer expenditures on autos by approximately 12 percent.
c
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The Federal Reserve makes decisions regarding ________ policy while Congress makes decisions regarding ________ policy.
A. fiscal; monetary B. structural; fiscal C. monetary; fiscal D. fiscal; structural
A variety of indicators such as goods and labor market integration, differing unemployment rates, and the lack of fiscal federalism have prompted most economists to:
A) herald the success of the Eurozone. B) conclude that the Eurozone has performed better than the United States in nearly every category. C) conclude that the Eurozone has not been (and is not now) an optimal currency area going back to the 1990s. D) recommend changes to the new currency to make it more responsive to demand shocks.
Refer to the graph shown of a monopolistically competitive firm. The graph shows that:
A. new firms will enter the industry. B. some existing firms will leave the industry. C. the price of the product is $90. D. the industry is in long-run equilibrium.
When the elasticity coefficient for resource demand is greater than one, resource demand is:
A. inelastic. B. elastic. C. unit-elastic. D. perfectly inelastic.