Along a straight-line demand curve (dropping all minus signs), the price elasticity of demand
A. gets larger as quantity demanded gets larger.
B. gets smaller as quantity demanded gets larger.
C. always equals one.
D. is constant (though not necessarily equal to one).
Answer: B
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When the demand curve shifts rightward and the market moves to a new equilibrium, then the
A) quantity supplied increases. B) supply decreases. C) quantity supplied decreases. D) supply increases. E) price falls to restore the equilibrium.
Differences in growth rates cannot explain why
A. some countries are wealthier than others. B. income inequality exists. C. the convergence hypothesis may hold. D. the productivity growth rates in China and Japan are converging.
Data show that in the U.S. since 1915, the velocity of M1 money
a. has been highly stable at approximately 24 b. has increased at about 3 percent per year c. has been erratic, varying between about 2 and 6 d. increased steadily until the 1960s, then decreased sharply thereafter e. has stayed fairly constant at approximately 4
Sport Tee Corporation manufactures T-shirts bearing the logos of professional football teams. The wholesale market for sport T-shirts is perfectly competitive. The manager forecasts the wholesale price of T-shirts next year to be $7.00. The firm's estimated marginal cost isSMC = 12 ? 0.005Q + 0.0000008Q2where Q is the number of T-shirts produced and sold each month. Sport Tee Corporation will have a fixed cost of $2,000 per month. Monthly profit will be
A. $2,250 B. $4,250 C. -$1,150 D. -$2,000 E. $3,400