Demand is a schedule of
A) how much of a good a person wants.
B) how much of a good people will purchase at each different possible price.
C) how much of a good people will purchase at each income level.
D) each possible price and the amount people will buy when their incomes change.
Answer: B
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Refer to Figure 5-5. If, because of an externality, the economically efficient output is Q2 and not the current equilibrium output of Q1, what does D1 represent?
A) the demand curve reflecting social benefits B) the demand curve reflecting the sum of private and social benefits C) the demand curve reflecting private benefits D) the demand curve reflecting external benefits
A barrier to entry
A) makes it illegal for firms to enter the industry. B) can be thought of as unrelated to monopoly. C) slows or even prevents entry into a market. D) usually takes the form of a cartel.
If a demand shock causes the economy to move to a real GDP level that is below its full employment level, then
a. we refer to this as a positive demand shock. b. the economy will remain at this point in the long run. c. the AS curve will adjust in the long run until the economy returns to full employment. d. the AD curve will move back to its original position in the long run. e. the unemployment rate will decline.
According to an economist, which of the following would be an example of investment spending?
a. A firm spending $8 million for the maintenance of 50 recreational parks across its home country b. An individual buying $1 million of stock in a leading software company c. An individual spending $0.5 million in government bonds d. A firm spending $10 million to purchase a new factory