Which of the following is NOT provided in the textbook as something that might lead to the creation of a new market?
A. New laws
B. New buyers
C. New sellers
D. New services
Answer: A
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Which of the following is likely to reduce the total efficiency units of labor in an economy?
A) A decrease in the price of capital B) A recession that lowers aggregate demand C) An increase in the price level D) An earthquake that kills several people
Refer to Figure 19-4. The equilibrium exchange rate is at A, $3/pound. Suppose the British government pegs its currency at $4/pound. Speculators expect that the value of the pound will drop and this shifts the demand curve for pounds to D2
After the shift, A) there is a surplus of pounds equal to 400 million. B) there is a shortage of pounds equal to 600 million. C) there is a shortage of pounds equal to 200 million. D) there is a surplus of pounds equal to 600 million. E) there is a shortage of pounds equal to 400 million.
Which of the following statements is true of the price elasticity of? demand?
A) As the number of substitutes for a product increases, the price elasticity of demand for that good decreases. B) If the budget share of a particular good in a consumer's bundle increases, the price elasticity of demand for that good is likely to decrease. C) The price elasticity of demand for a good is generally higher in the long run than in the short run. D) The demand for a good with a price elasticity of demand of zero is highly responsive to price changes.
When marginal utility is positive but decreasing, total utility is
A) decreasing. B) negative. C) increasing. D) zero.