Which of the following is an accurate statement about the effect of close substitutes?
a. Goods with many close substitutes will usually have elastic demands.
b. Goods with many close substitutes will usually have inelastic demands.
c. Goods with few close substitutes will usually have perfectly elastic demands.
d. Goods with few close substitutes will usually have perfectly inelastic demands.
a. Goods with many close substitutes will usually have elastic demands.
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If the government increases spending and there is a complete direct expenditure offset, then
A) aggregate demand and real Gross Domestic Product (GDP) will not change. B) aggregate demand and real Gross Domestic Product (GDP) will increase by the amount of the spending increase. C) the price level will drop. D) the government spending multiplier will be greater than zero.
An increase in an individual's income without changing relative prices will:
a. rotate the budget constraint about the X-axis. b. shift the indifference curves outward. c. shift the budget constraint outward in a parallel way. d. rotate the budget constraint about the Y-axis.
A characteristic of outsourcing is
a. completely unrelated to vertical integration b. likely to be profitable exactly when vertical integration is unprofitable c. it prevents a firm from focusing on its core competencies d. it prevents the exploitation of differing degrees of economies of scale at different points in the supply chain
Which of the following type of firm is not a price taker in the market in which the firm buys its inputs?
a. Perfect competition. b. Monopsony. c. Oligopoly. d. Monopoly.