Demand for low budget items, such as candy, is generally ________ than demand for large budget items, such as automobiles.
A. higher
B. lower
C. more elastic
D. less elastic
Answer: D
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If the interest rate rises to 25% would the investment still take place?
a. Yes since NPV>0 b. No since NPV<0 c. Yes since the present value of the cash flows is greater than zero d. No since the present value of the cash flows is lesser than zero
Mandated reductions in tailpipe emissions from automobiles are an example of:
A. government provision. B. specific taxes. C. the Coase Theorem. D. direct controls.
Suppose foreign exchange markets anticipate a devaluation for country A. Further assume that policy makers in country A will continue to fix its nominal exchange rate. In order to peg the currency at its original level, which of the following must occur?
A) increase the domestic interest rate B) increase the domestic price level C) convince trading partners to raise their interest rates D) all of the above E) none of the above
In Figure 45.1, the opportunity cost to workers of working at the equilibrium wage-labor combination is 
Figure 45.1
A. OW*CL*. B. ABC. C. OBCL*. D. OACL*.