Which product will have the most inelastic demand curve?
A. Beer
B. Motor vehicles
C. Milk
D. Household electricity
D. Household electricity
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Suppose that the government enacts a tax on Good X. In order to estimate the effect of the tax on the quantity demanded of a related good, Good Y, we can use the concept of the:
A) price elasticity of demand. B) income elasticity of demand. C) cross-price elasticity of demand. D) cost elasticity of demand.
Recall the Applied Perspective concerning Morocco, Coca-Cola, and Multipliers. Coca- Cola's decision to set up a bottling plant in Tangier has
a. created upstream and downstream linkages that accounted for 0.7 percent of Morocco's 1999 GDP b. had minimal impact on Morocco's economy c. created a backlash against the Westernization of the Moroccan economy d. created little new employment since the bottling plant is highly automated e. resulted in the bankruptcy of local, traditional, soft drink manufacturing firms
A bank's reserves include its
A. vault cash and deposits with the Federal Reserve. B. holdings of government bonds and corporate stocks. C. checkable deposits and holdings of government bonds. D. tellers who are ready and able to work if there is a strike by the regular tellers.
Answer the following statements true (T) or false (F)
1. If you received a 4% increase in your nominal wage and the price level increased by 6%, then your real wage has increased by 2%. 2. Nominal wage measures the purchasing power of a given amount of real wage. 3. One reason for the high wage rates in the United States and other advanced economies is the high productivity of labor in these countries. 4. In a purely competitive labor market, a profit-maximizing firm will hire labor up to the point where the marginal resource cost equals the wage rate.