The owner of a bakery decides to drop the price of lemon cakes by 5%, how much does quantity sold have to rise to stop the revenue from decreasing
a. 2%
b. 3%
c. 4%
d. 5%
d
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A common pool resource is nonrival and nonexcludable
Indicate whether the statement is true or false
Suppose the economy is producing at the natural rate of output and the government passes legislation that severely restricts a company's ability to reduce production costs via outsourcing
Everything else held constant, this policy action will cause ________ in the unemployment rate in the short run and ________ in inflation in the short run. A) an increase; an increase B) a decrease; a decrease C) a decrease; an increase D) no change; no change
Expansionary fiscal policy increases the level of aggregate demand by
a. increasing consumption by raising disposable income through increased government purchases through increased spending by the federal government. b. increasing consumption by raising disposable income through raising after-tax profits through cuts in business taxes. c. increasing consumption by raising disposable income through increased federal grants to state and local governments. d. increasing consumption by raising disposable income through cuts in personal income taxes or payroll taxes.
Figure 10-18
As shown in , the economy's point of short-run equilibrium, given by the shift of the aggregate demand curve from AD1 to AD2, is
a.
E1.
b.
E2.
c.
E3.
d.
unable to be determined.