If the demand for school ball caps is inelastic, an increase in price will result in:
A. a decrease in profits.
B. an increase in total revenue.
C. a decrease in total revenue.
D. an increase in the quantity demanded.
Answer: B
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When the economy is in a recession, ________ taxes decrease while ________ spending increases and, as a result of this automatic fiscal policy, aggregate demand ________
A) induced; discretionary; is not changed B) needs-tested; induced; decreases C) induced; needs-tested; increases D) discretionary; induced; is not changed E) discretionary; needs-tested; increases
Which of the following correctly describes the trend in the percentage of U.S. families living in poverty?
a. The poverty rate has steadily increased from approximately 5 percent in 1960 to over 40 percent in 1997. b. The poverty rate has steadily declined from approximately 40 percent in 1960 to under 5 percent today. c. The poverty rate steadily declined from about 22 percent in 1959 to about 12 percent in 1969, and has fluctuated since then. The poverty rate in 2002 was approximately 12.1 percent. d. The poverty rate steadily increased from about 12 percent in 1960 to about 22 percent in 1970, and has fluctuated since then.
The accompanying figure shows the production possibilities curve for the island of Genovia:
The opportunity cost of producing one ton of agricultural products in Genovia is:
A. 1/5 of a car. B. 1/50 of a car. C. 1,000 cars. D. 1 car.
Changes in tax rates impact the economy through:
A. Both aggregate demand and aggregate supply. B. Aggregate supply. C. Aggregate demand.