If the cross elasticity of demand for good A with respect to good B is +2.7, then good A is
A. an inferior good.
B. a normal good.
C. a substitute for good B.
D. a complement to good B.
Ans: C. a substitute for good B.
You might also like to view...
What is the opportunity cost of going from point C to point D?
All of the following would stimulate economic growth EXCEPT
A) decreasing taxes on consumption (for instance, decreasing a sales taxes) and increasing income taxes. B) subsidizing basic research. C) decreasing tuition charges at state universities. D) encouraging international trade.
Which of the following does not hinder economic development?
a. Low birth rates. b. Low GDP that limits saving and investment. c. Lack of knowledge. d. Lack of technology. e. Lack of physical capital.
Which basic approach to environment policy may be the only workable solution in brief but serious emergencies that do not allow for time to plan and enact a systematic program?
A. Taxes on pollution B. Voluntary compliance C. Tradable emissions permits D. Direct controls like legal ceilings