Other things being equal, demand is more elastic if
A) the good is less expensive the good.
B) the time period for adjustment is shorter.
C) a family spends a larger percentage of its budget on the good.
D) the good is more unique.
Answer: C
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In order for mutually beneficial trade to occur between two otherwise isolated nations
A. each nation must be able to produce at least one good absolutely cheaper than the other. B. each nation must be able to produce at least one good relatively cheaper than the other. C. one nation's production must be labor-intensive while the other nation's production is capital-intensive. D. each nation must face constant costs in the production of the good it exports.
If a used-car dealer suffers economic losses, then
A) as a group, its customers were necessarily made worse off. B) as a group, its competitors necessarily enjoyed economic profits. C) it must pass its losses onto its future customers. D) none of the above is true.
If TruLite's management studied the light fabrication department and found that the department should assemble 25 lamps per hour per worker and set its piece rate to get workers to meet output level, then this standard is called the:
A. incentive adjustment. B. random element of production. C. risk premium. D. benchmark.
When the average variable cost curve is upward sloping, what must be true about the marginal cost curve?
A) It is U-shaped. B) It is above the average variable cost curve. C) It is upward-sloping. D) It is below the average variable cost curve. E) It is a straight line.