Suppose you are given the following demand data for a product.PriceQuantity Demanded$1030940850760670The price elasticity of demand (based on the midpoint formula) when price increases from $7 to $9 is
A. elastic.
B. inelastic.
C. perfectly elastic.
D. unit elastic.
Answer: A
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Which of the following is NOT a flow variable?
A) saving B) consumption C) investment D) savings
Beth, an American citizen, travels to Italy on vacation and buys an espresso machine to bring home. Her purchase increases a. Italy's GDP
b. Italy's GDP and U.S. GDP, since Beth spent dollars buying the machine. c. U.S. GDP since she will have the machine with her at home in the U.S. d. Neither U.S. nor Italy's GDP, since the product was bought in one country and used in another.
A labor contract provides for a first-year wage of $10 per hour, and specifies that the real wage will rise by 3 percent in the second year of the contract. The CPI is 1.00 in the first year and 1.07 in the second year. What dollar wage must be paid in the second year?
A. $11.02 B. $10.70 C. $10.90 D. $10.30
The fraction of deposits a bank must hold in the form of reserves is called the:
A. reserve ratio. B. currency to reserve ratio. C. excess reserve ratio. D. required reserve ratio.