When Tim earned $65,000 he purchased 10 novels a year. His income has just increased to $68,000 and he plans to purchase 15 novels this year. Tim's income elasticity of demand for novels equals
A) 0.
B) 0.11.
C) 1.67.
D) 8.87.
Answer: D
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If the Fed tries to lower the unemployment rate so it is lower than the natural unemployment rate, in the short run before the expected inflation rate changes, the SRPC ________ and the LRPC ________
A) shifts downward; shifts leftward B) shifts downward; does not change C) does not change; shifts rightward D) shifts upward; does not change E) does not change; does not change
The data in the table above are the U.S. balance of payments. The capital and financial account balance is
A) $0. B) -$80 billion. C) -$200 billion. D) +$200 billion.
In which case is the transition from short run to long run likely to involve the shortest chronological time period?
A. A service that provides temporary secretaries to companies B. An automobile factory C. A farm D. An electric utility
Firms in a perfectly competitive industry are earning economic losses. This is
A) a signal to entrepreneurs that some of the firms in the industry should exit and the resources of these firms should move into production of other goods. B) a signal to entrepreneurs that additional resources should be brought into this industry in order to make it profitable. C) a signal that the entrepreneurs are doing a poor job and should become workers for someone else. D) a signal to government officials that a subsidy is needed for the firms in the industry.