Which of the following will NOT affect the elasticity of demand for a product?
A. the cost of producing the product
B. the number of substitutes
C. the percentage of the consumer's budget spent on the product
D. how long consumers have to adapt to price changes
E. all of the above will affect the elasticity of demand for a product
Answer: A
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Which of the following statements regarding the use of gold as money is false?
A) The money supply would be easy to control because of the predictability of new gold discoveries. B) It is durable. C) It has value other than money. D) It is acceptable to traders.
An investor owns bond #1 that has a rate of return of 10 percent, but a similar bond #2 has an 11 percent return and equal risk. By selling bond #1 and buying bond #2 to earn a higher return, the investor is engaging in:
A. Pooling B. Arbitrage C. Diversification D. Time preference
In the above table, what is the maximum price that consumers are willing to pay for the 200th brownie?
A) 0 B) 20¢ C) 60¢ D) 80¢
Advertising:
A. can convey useful information to consumers. B. can cause perceived differences that don't exist and drive prices up. C. can increase competition in the marketplace and lower prices. D. All of these statements are true.