A tax is imposed on wine. Sellers will bear the full burden of this tax if the:
a. demand for wine is perfectly inelastic
b. price elasticity of demand for wine equals 1.0.
c. demand for wine is unit elastic.
d. supply for wine is perfectly inelastic.
d
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Under the Bretton Woods system, participating countries
A) pegged their currencies to the U.S. dollar. B) maintained a fixed exchange rate with gold. C) allowed their currencies to float freely. D) pegged their values to the British pound.
Stock prices change with surprises
Indicate whether the statement is true or false
The aggregate demand curve slopes downward indicating that
a. an increase in the general price level will reduce the aggregate quantity of goods and services demanded. b. an increase in the general price level will increase the aggregate quantity of goods and services demanded. c. a change in the interest rate will alter the aggregate quantity of goods and services demanded. d. consumers substitute between domestic-made and foreign-made goods as their relative prices change.
A reduction in inflation would lead to
a. more frequent price changes and increased variability of relative prices. b. more frequent price changes and decreased variability of relative prices. c. less frequent price changes and increased variability of relative prices. d. less frequent price changes and decreased variability of relative prices.