With only two goods, x and y, if x and y are gross substitutes, a rise in px must necessarily:
a. increase spending in x.
b. reduce spending in x.
c. increase spending in y.
d. reduce spending in y.
c
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Promoters for the Rolling Stones were clearly "short selling" when
A) they distributed their latest CD to radio stations free of charge. B) they sold their latest CD to retailers at wholesale prices. C) they sold the world-tour concert tickets weeks in advance. D) they promoted the band without Bill Wyman, the original bass player.
Comment on the following statement: "Capital investment decisions always involve risk."
What will be an ideal response?
An example of an excludable good or service is:
A. ice cream. B. a public park. C. national defense. D. air.
Under the assumption of rational expectations, government fiscal and monetary policy changes are effective in the short run
A) all of the time. B) only when the short-run aggregate supply curve is the same as the long-run aggregate supply curve. C) only when the policy changes leave the position of the aggregate demand curve unaffected. D) only when the policy changes are unanticipated.