If the price elasticity of demand was 4.0 (in absolute terms), a 10% off sale would lead to:
a. a 40% increase in purchases by customers.
b. a 40% decrease in purchases by customers.
c. a 2.5% increase in purchases by customers.
d. a 2.5% decrease in purchases by customers.
a
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Employing Figure 3-1 above, autonomous consumption expenditures are ________, and the marginal propensity to consume is ________
A) 200; 0.75 B) 500; 1 C) 200; 0.60 D) 0; 1
You have been given an opportunity to invest in a stock. Recent trends suggest that a one percent rise in the stock market leads to approximately a two and one-half percent rise in the price of this stock
The real risk-free rate currently stands at 6% and stocks on average have provided 12% returns. Using the capital asset pricing model, determine the appropriate discount rate for the stock in question.
The formula for determining a real variable is real variable =
a. (nominal variable ? 100) ? CPI b. (nominal variable ? CPI) ? 100 c. (nominal variable ? price index) ? 100 d. (nominal variable ? price index) + 100 e. (nominal variable ? price index) ? 100
The demand curve is a graphic representation of:
a. the relationship between price and quantity supplied of a certain good or service. b. the relationship between price and quantity demanded of a certain good or service. c. the relationship between supply and demand for a certain good or service. d. the relationship between productivity and quantity demanded of a certain good or service.