The market demand curve is the horizontal summation of all individual demand curves
a. True
b. False
Indicate whether the statement is true or false
True
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Refer to the figure above. What is the absolute value of the arc elasticity of demand when the price falls from $8 to $4?
A) 2 B) 4 C) 8 D) 10
Using the above figure determine which country has the comparative advantage in the production of corn. In addition, determine which has the comparative advantage in the production of barley
What will be an ideal response?
Suppose milk and cereal are compliments and the demand for milk is Qdm = 40 - 6Pm - 2Pc, where Qdm stands for millions of gallons of milk demanded, Pm stands for the price of milk and Pc stands for the price of cereal. The supply of milk is Qsm = 6Pm - 8, where Qsm stands for millions of gallons of milk supplied. The demand and supply of cereal are Qdc = 90 - 5Pc - Pm and Qsc = 5Pc - 10, respectively, where Qdc stands for millions of boxes of cereal demanded and Qsc stands for millions of boxes of cereal supplied. Suppose the government imposes a $2.00 per gallon tax on milk. The formula for the market-clearing curve for milk after the tax is:
A. Pm = 4 - (Pc/6). B. Pm = 5 - (Pc/6). C. Pm = 5 + (Pc/6). D. Pm = 2 - (Pc/6).
Which of the following questions can be answered by the process of demand side GDP determination?
A. How large is equilibrium GDP? B. What can cause unemployment? C. Is demand side equilibrium consistent with supply side equilibrium? D. Does the economy have inflation?