The law of demand can be explained as:
A. a lot of people wanting the same thing.
B. the higher the price, the smaller the quantity demanded, ceteris paribus.
C. people are willing to make limited sacrifices to acquire products.
D. legal reasons people make purchases in the marketplace.
Answer: B
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Economic freedom means that
A) some goods and services are free. B) firms are regulated by the government. C) people are able to make personal choices and their property is protected. D) the nation's government is a democracy. E) the rule of law does not apply.
Suppose that florists and landscape workers are not unionized. If florists unionize, then the wages of
a. florists will rise, and the wages of landscape workers will fall. b. florists will fall, and the wages of landscape workers will rise. c. both florists and landscape workers will rise. d. both florists and landscape workers will fall.
The slope of a budget line: a. is the negative of the price ratio, -PX/PY b. depends on income
c. depends on preferences. d. is positive.
Mrs. Brown decides to keep $7,000 in her checking account in anticipation of rising interest rates. This is an example of the
A. speculative motive for holding money. B. precautionary motive for holding money. C. commodity demand for money. D. transaction demand for money.