Suppose the price elasticity of teenagers' demand for cigarettes is 2.0. If the government imposes a tax on cigarettes that raises the price by 10 percent, by how much will it reduce teenaged smoking?
A) by 5 percent
B) by 10 percent
C) by 15 percent
D) by 20 percent
D
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What is meant by decreasing returns to scale?
What will be an ideal response?
Under a fixed exchange rate system, a real interest rate corresponding to the upward-sloping portion of the NCF curve reflects the fact that a central bank ________, and the real interest rate corresponding to the horizontal portion of the NCF curve
reflects the fact that a central bank ________. A) can always supply more domestic currency; can always meet the demand for foreign currency B) can always supply more domestic currency; is limited in meeting the demand for foreign currency C) is limited in meeting the demand for domestic currency; can always meet the demand for foreign currency D) is limited in meeting the demand for domestic currency; is limited in meeting the demand for foreign currency
If a bank has $1 million in demand deposits, $400,000 in reserves, and faces a 30 percent reserve requirement, the amount of money that a bank could initially create by loaning out their excess reserves is:
a. $600,000. b. $400,000. c. $300,000. d. $100,000.
Poverty is most likely to decrease when
A. Population growth exceeds economic growth. B. GDP increases regardless of what happens to population growth. C. Economic growth exceeds population growth. D. Population increases regardless of what happens to economic growth.