Which of the following situations could generate a shortage?
A. Demand for a good increases, resulting in a new higher market clearing price.
B. Demand for a good decreases, resulting in a new lower market clearing price.
C. Demand for a good decreases, but the price is not permitted to fall.
D. Demand for a good increases, but the price is not permitted to rise.
Answer: D
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The price of pizza falls by 25 percent. If the elasticity of demand for pizza is equal to –1.5, what will happen to the quantity of pizza demanded?
What will be an ideal response?
Which of the following is true?
a. Decision making should never be centralized b. If you decide to centralize the decision making authority, figure out a way to keep information hidden from it c. If you decide to centralize the decision making authority, figure out a way to transfer information to the third party d. If you decide to centralize the decision making authority, figure out a way to transfer information to the decision maker
Which of the following are likely to increase investment and as a result, aggregate demand?
a. decreased demand for investment goods b. falling real interest rates c. rising real interest rates d. increased business taxes
The scarcity of physical resources such as fuel means:
a. we should keep our homes cooler in the winter b. we should keep our homes warmer in the summer c. we should live close to our jobs to conserve fuel d. all of these are true.