Finding both parties to a trade who have something the other party wishes to trade for is called a:
A. store of value.
B. double coincidence of wants.
C. medium of exchange.
D. unit of account.
Answer: B
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Suppose the log-linear demand for widgets is found to be
Ln(Q) = 1.5 - 2ln(p) According to this equation, a 10% increase in price will decrease Q by what percentage? What is the price elasticity of demand?
A monopoly:
a. faces the market demand curve which is downward sloping. b. has a marginal revenue curve which slopes downward and lies below its demand curve. c. will maximize profits by producing an output level where MR = MC. d. all of these.
Is it possible for the average fixed cost curve to have the shape depicted above? Explain
What will be an ideal response?
According to the theory of purchasing power parity, if the inflation rate in England is greater than the inflation rate in Japan,
A) the law of one price has been violated. B) the nominal value of the pound will appreciate against the yen. C) the nominal value of the yen will appreciate against the pound. D) the nominal value of the pound will appreciate against the yen, but only if the two countries are on the gold standard.