If a good is inferior, then it has an income elasticity of demand that is
A) equal to zero.
B) greater than zero.
C) less than zero.
D) greater than one.
E) undefined.
C
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For this question, use the Keynesian IS—LM model with flexible exchange rates. Eastland's main trading partner is Westland. Suppose Westland undertakes an expansionary monetary policy
(a) What is the effect of Westland's expansionary monetary policy on Eastland's real exchange rate in the short run, assuming no change in Eastland's policies? (b) What is the effect of Westland's expansionary monetary policy on Eastland's real exchange rate in the long run, assuming no change in Eastland's policies? (c) What is the effect of Westland's expansionary monetary policy on Eastland's nominal exchange rate in the short run and in the long run?
Which of the following is not an example of a flow variable?
a. The amount of income that a person earns each month b. The amount of interest that a savings account earns each week c. The amount of money in a savings account d. The amount of taxes that a person pays each year e. All of these are flow variables
Straker Industries estimated its short-run costs using a U-shaped average variable cost function of the formAVC = a + bQ + cQ2and obtained the following results. Total fixed cost (TFC) at Straker Industries is $1,000. 
If Straker Industries produces 20 units of output, what is estimated average variable cost (AVC)?
A. $19.40 B. $67.40 C. $179.40 D. $171.40
If two variables move in opposite directions, they are said to be negatively correlated.
Answer the following statement true (T) or false (F)