Suppose there are only two goods (Good A and Good B) and the average person buys 4 of Good A in a year and 3 of Good B. If the Price of Good A is $5 and the Price of Good B is $10, the price of the market basket
A. is 50.
B. is 20.
C. is 30.
D. is 100.
Answer: A
You might also like to view...
Jim is haggling with a car dealer over the sale price of a used car. When he entered the store, it was empty. During the negotiations, a second customers walks in, interested in that particular car, and the storekeeper rejects Jim's offer. This is because
a. The car dealer's disagreement value decreased b. The car dealer's disagreement value increased c. The car dealer's disagreement value did not change d. None of the above
A trade surplus occurs when a country:
A. imports more than it exports. B. imports less than it exports. C. has a negative balance of trade. D. has a zero balance of trade.
The precautionary demand for money
a. varies inversely with the income level b. varies inversely with the price level c. is used as insurance against unexpected needs d. states that nominal income must exceed real income e. is a classical concept in monetary theory
Use the following table, which shows the aggregate demand and aggregate supply schedule for a hypothetical economy, to answer the next question.Real Domestic Output Demanded (in billions)Price Level (index value)Real Domestic Output Supplied (in billions)$3,000350$9,0004,0003008,0005,0002507,0006,0002006,0007,0001505,0008,0001004,000At the price level of 150, there will be a general ________.
A. shortage in the economy, and output demanded will increase as the price level falls B. surplus in the economy, and output supplied will increase as the price level rises C. surplus in the economy, and output supplied will decrease as the price level falls D. shortage in the economy, and output demanded will decrease as the price level rises