Changes in the price of a good lead to:
A. no effects in quantity supplied or demanded.
B. changes in demand.
C. changes in supply.
D. changes in the quantity supplied of the good.
Answer: D
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Expansionary monetary policy lowers interest rates and forces a real appreciation of the dollar in international currency markets
Indicate whether the statement is true or false
German luxury car exports were hurt in 2009 as a result of the recession. How would this decrease in exports have affected Germany's aggregate demand curve?
A) The aggregate demand curve would have shifted to the right. B) The aggregate demand curve would not have shifted, but there would have been a movement up the aggregate demand curve. C) The aggregate demand curve would have shifted to the left. D) The aggregate demand curve would not have shifted, but there would have been a movement down the aggregate demand curve.
Suppose a person's utility for leisure (L) and consumption (Y) can be expressed as U = Y + L0.5. Assuming a wage rate of $10 per hour, show what happens to the person's labor supply curve when the person wins a lottery prize of $100 per day
What will be an ideal response?
Assume the supply curve for product X is perfectly elastic and that government imposes a $2- per-unit excise tax. We can conclude that the resulting:
A. increase in output will be greater the less elastic the demand curve. B. decrease in output will be greater the less elastic the demand curve. C. decrease in output will be greater the more elastic the demand curve. D. increase in output will be greater the more elastic the demand curve.