If the demand for a good decreased, what would be the effect on the equilibrium price and quantity?
A. Price would increase, and quantity would decrease.
B. Price would decrease, and quantity would decrease.
C. Price would increase, and quantity would increase.
D. Price would decrease, and quantity would increase.
Answer: B
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a. greater than b. less than c. about equal to d. not comparable to
Using the rule of 72, determine how long it would take for real GDP to double if it grew at a constant growth rate of 4 percent.
A. 72 years. B. 144 years. C. 4 years. D. 18 years.
When the price of milk rises, there is no change in the amount of dog food purchased. This is an example of:
A. indifference trade-off between the two goods. B. the interaction between -two correlated goods. C. the value people place on dogs versus milk. D. two items that are uncorrelated.
The owner of a local pretzel cart has estimated that if he lowers the price of pretzels from $4.00 to $3.00, he will increase sales from 800 to 1,100 pretzels per day. Using the midpoint formula, the demand for pretzels is
A. perfectly elastic. B. inelastic. C. unit elastic. D. elastic.