The substitution effect:
A. Is generally so weak that its effect cannot be predicted
B. For an increase in the relative price of a good is sometimes positive, but sometimes negative
C. Measures the change in the quantity demanded of a good from a change in its relative price
D. Measures the change in the quantity of a good demanded brought about by a change in real income associated with a change in the price of the good
C. Measures the change in the quantity demanded of a good from a change in its relative price
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According to the graph shown, if this economy were to open to trade, domestic prices would:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. remain $16 for domestically produced goods, and be $23 for those units imported.
B. increase to $23 for all units.
C. remain $16, with more units sold overall.
D. decrease to $11 for all units.
Refer to the graph. Which of the following schedules correctly reflects "supply"?
What will be an ideal response?
Answer the following statement true (T) or false (F)
1) The interest-rate cost-of-funds curve is perfectly elastic because firms can borrow as much or as little as they want at market interest rates. 2) The interest-rate cost-of-funds curve is perfectly elastic because expected rates of return on R&D are constant. 3) Large, well-established firms are more likely to use retained earnings to finance R&D, while small start-up firms are more likely to rely on venture capital. 4) Kara's Kettles, Inc. has developed a new and improved type of cookware. Alex, a typical consumer, will necessarily purchase Kara's new product if his MU/P for the new cookware exceeds that of competing products. 5) According to the inverted-U theory of R&D, other things equal, firms in industries with concentration ratios around 10 percent will be more technologically progressive than firms in industries with 50 percent concentration ratios.
Informational advertising is mostly used for
A) an inexperience good. B) a search good. C) an experience good. D) a persuasive good.