In order to fit linear supply and demand curves to data, we need to find the parameters, a, b, c, and d, of the corresponding functions.
A.One procedure for finding those values uses the known values of: the price elasticity of demand and supply and the income elasticity of demand.
B. the price and quantity of equilibrium and the elasticities of supply and demand.
C. any two known values of price and quantity and income elasticity of demand.
D. the demand equation and income elasticity of demand.
B. the price and quantity of equilibrium and the elasticities of supply and demand.
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As the federal funds rate changes, other interest rates tend to move in the same direction
Indicate whether the statement is true or false
Refer to Table 7-6. All of the following are terms of trade that could possibly benefit both countries except
A) 1/4 of a belt : 1 sword. B) 7/10 of a belt : 1 sword. C) 4/5 of a belt : 1 sword. D) 2/3 of a belt : 1 sword.
Carla is spending all her income on only two goods: apples and bananas. The price of an apple is $2 and the price of a banana is $1 . If Carla's marginal utility of an apple is 4 and her marginal utility of a banana is 3, she should consume:
a. more apples and fewer bananas to maximize total utility. b. more bananas and fewer apples to maximize total utility. c. more apples and more bananas to maximize total utility. d. fewer apples and fewer bananas to maximize total utility. e. her current amounts of apples and bananas to maximize total utility.
The potential output of an economy is the level of output produced when the
a. real wage equals the nominal wage. b. price level is constant. c. expected real wage equals the inflation rate. d. expected price level equals the unemployment rate. e. expected price level equals the actual price level.