When economists want to obtain a measure of the responsiveness of quantity demanded to changes in price, they use
A) the slope of the demand curve.
B) the price elasticity of demand.
C) only the percentage change in quantity demanded.
D) the cross-price elasticity of demand.
B
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The situation in which the long-run average cost curve exhibits economies of scale over the entire range of output is called a "natural monopoly
" Explain why, in the case of a natural monopoly, it would be cost efficient to have a single firm serve the entire market.
Which of the following situations is likely to lead to dynamic open market operations?
A) A recession B) An increase in Federal Reserve float C) An increase in Treasury cash holdings D) An increase in currency outstanding
Just prior to the year 2000, the Fed was concerned that people would make larger than normal bank withdrawals out of fear of what was called the "Y2K computer bug." Fearing that this would disrupt the banking system, the Fed wanted to use a defensive action to prevent any such disruption. This would take the form of open market bond:
A. sales that would prevent the federal funds rate from increasing. B. purchases that would prevent the federal funds rate from decreasing. C. purchases that would prevent the federal funds rate from increasing. D. sales that would prevent the federal funds rate from decreasing.
If Dell, a computer company, is determining whether to build a new plant in Texas or in New Mexico, it is making a(n) ________ decision
A) immediate-run B) long-run C) short-run D) variable-input