Last year, Sefton purchased 60 pounds of potatoes to feed his family of five when his household income was $30,000. This year, his household income fell to $20,000 and Sefton purchased 80 pounds of potatoes
All else constant, Sefton's income elasticity of demand for potatoes is
A) positive, so Sefton considers potatoes to be a normal good and a necessity.
B) positive, so Sefton considers potatoes to be an inferior good.
C) negative, so Sefton considers potatoes to be an inferior good.
D) negative, so Sefton considers potatoes to be a normal good.
C
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Falling interest rates can
A) raise the cost of buying new homes and fewer new homes will be purchased. B) lower the cost of buying new homes and fewer new homes will be purchased. C) raise the cost of borrowing for firms and decrease investment. D) increase a firm's stock price, which causes firms to issue more stock shares, and thus increases funds for investment.
The seller of an option has the ________ to buy or sell the underlying asset while the purchaser of an option has the ________ to buy or sell the asset
A) obligation; right B) right; obligation C) obligation; obligation D) right; right
An increase in the price of gasoline above equilibrium will
A. Shift the gasoline supply curve to the right. B. Cause a shortage of gasoline. C. Cause a surplus of gasoline. D. Shift the gasoline demand curve to the right.
The noise from the low altitude combat training the Air Force conducts over the Yippy I-O Ranch causes the ranch's cattle to lose weight. Which of the following actions is not consistent with recognition that the Yippy I-O has a property right to its skies? a. The Air Force equips its planes with mufflers
b. The Air Force compensates the Yippy I-O for the value of the lost weight. c. The ranch compensates the Air Force for the cost of moving the exercises to another location. d. The Air Force pays for cow earplugs for the ranch herd.