If the price of shoes falls from $10 to $8 and the amount sold increases by 12 percent, it can be concluded that:
A. the demand for shoes is perfectly inelastic.
B. shoes are complementary goods.
C. the demand for shoes is elastic.
D. the demand for shoes is inelastic.
Answer: D
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Suppose a whiskey maker advertises its whiskey as follows: "Whiskey that tastes expensive and is expensive." The manufacturer is assuming some customers who buy whiskey
A) have a perfectly inelastic demand for whiskey. B) have a relatively inelastic demand for whiskey. C) want to impress their friends or associates. D) will ignore the law of demand. E) will purchase more at higher than at lower prices.
Which of the following accurately describes growth rates in the United States from 1900 to the present?
A) Growth rates have risen continuously from 1900 to the present. B) Growth rates rose until the 1970s, slowed until the 1990s, rose again until 2005, and then slowed again to the present. C) Growth rates rose until the 1970s and then fell until the present. D) Growth rates have fallen continuously from 1900 to the present.
In the classical macroeconomic model, a decrease in the real wage would cause
a. a decrease in the marginal product of labor and an increase in the quantity demanded for labor. b. an increase in the marginal product of labor and an increase in the quantity demanded for labor. c. no change in the quantity demanded for labor. d. an increase in both the supply of and demand for labor.
Suppose a market basket of goods and services costs $400 in the base year and $500 this year. The consumer price index (CPI) for this year is:
a. 25. b. 100. c. 125. d. 500.