If a good is normal, its
A. Cross-price elasticity is positive.
B. Income elasticity of demand is positive.
C. Price elasticity of demand is positive.
D. Income elasticity of demand is negative.
Answer: B
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When the price of hot dogs is $1.50 each, 500 hot dogs are sold every day. After the price falls to $1.35 each, 510 hot dogs are sold every day. At the original price, what is the price elasticity of demand for hot dogs?
A. 0.2 B. 66.67 C. 2 D. 5
Society as a whole likely benefits from a decrease in poverty because:
A. if there are fewer people in poverty, the incentive to commit crimes falls. B. increased assistance to those in poverty raises their incentives to work. C. social programs to help the poor are a small portion of the U.S. government budget. D. if there are fewer families in poverty, there will be less demand for childcare.
Suppose that if poor households have a price elasticity of demand for medical care of 0.50 and rich households have a price elasticity of demand for medical care of 0.25, then a price increase of 10% would lead to the poor households reducing their quantity demanded for medical care by:
A. 2.5%. B. 5%. C. 25%. D. 50%.
A constant-cost industry has an infinitely elastic long-run supply curve.
Answer the following statement true (T) or false (F)