MP3 players and MP3 files are complementary goods. The cross-price elasticity of demand between MP3 players and MP3 files is expected to be
A) Positive.
B) Negative.
C) Equal to zero.
D) Undefined.
Answer: B) Negative.
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Which of the following statements about the circular-flow diagram is correct?
a. One must imagine that the economy operates without money in order to make sense of the diagram. b. The diagram leaves out details that are not essential for understanding the economic transactions that occur between households and firms. c. The government cannot be excluded as a decision maker in a circular-flow diagram. d. All of the above are correct.
Which of the following is accurate concerning the nature of international law?
a. It regulates all matters and relations between states. b. It addresses a narrow range of issues that arise between states. c. It has traditionally been regarded as harmful to elite superpowers. d. It is a set of rules and obligations that states recognize as binding on each other.
When costs are at a minimum,
A. the ratio of the MPL/MPK < Price L/Price K. B. MPL = MPK. C. Price L = Price K. D. the extra output we get from the last dollar spent on an input must be the same for all inputs.
Sales taxes are proportional in relation to income because the same tax rate applies regardless of the size of a purchase.
Answer the following statement true (T) or false (F)