Price and total revenue move in the same direction when demand is
A. price inelastic.
B. unit price elastic.
C. price elastic.
D. perfectly price elastic.
Answer: A
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Concepts useful in evaluating the costs and benefits of alternative types of taxes are:
A. efficiency, incidence and scarcity. B. revenue, scarcity, and shortage. C. incidence, scarcity, and shortage. D. efficiency, revenue and incidence.
How does the multiplier work and what might government use it for?
Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The opportunity cost of one tomato in Country A is:
A. 4 bananas. B. 5 bananas. C. 100 bananas. D. 20 bananas.
Describe the process in the money market by which the interest rate reaches its equilibrium value if it starts above equilibrium