If a 10 percent increase in the price of tomatoes leads to a 20 percent decrease in quantity demanded, then the price elasticity of demand for tomatoes, , equals -2
a. True
b. False
Indicate whether the statement is true or false
True
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What is required for a market to be considered monopolistically competitive? How does the equilibrium in a monopolistically competitive market resemble that in a perfectly competitive market? How are they different?
What will be an ideal response?
Which one of the following economic activities was NOT generally undertaken in New England in the colonial period?
(a) Fishing (b) Farming (c) Tobacco production (d) Shipbuilding
Hudson Manufacturing is an MNE based in the United States with operations in Asia. The firm is considering expansion into the European Union. Executives at the firm are debating whether central Europe or Eastern Europe would be best for the firm. Which of the following best supports a decision to establish operations in Eastern Europe?
A) Hudson wants to implement a high-performance work system. B) Hudson plans to staff the foreign facility with local managers. C) Hudson wants to minimize costs by keeping wages low. D) Hudson recently lost money in a joint venture.
Whenever there is excess demand for real balances, short-run adjustment occurs because:
a. savers and investors buy bonds and drive up their prices (drive down nominal rates of interest). b. investors and borrowers sell bonds (convert to cash) and drive down their prices (drive up nominal rates of interest). c. the price level falls to restore real balances. d. aggregate demand is decreased to restore equilibrium.