Suppose that the percentage change in demand is 10%, the price elasticity of supply is 2, and the percentage change in the equilibrium price is 3.33%. What is the price elasticity of demand?
A. 0
B. 1
C. 2
D. 3
Answer: B
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A firm's total revenue minus its total opportunity cost is called its
A) accounting profit. B) normal profit. C) economic profit. D) abnormal profit. E) entrepreneur's profit.
In the Cambridge approach, if k is .5, total output is $50 billion, and the money supply is $100 billion, the price level is
A) 0.5. B) 4.0. C) 3.0. D) 10.0.
Positive analysis:
A. is the best way to analyze a policy. B. leads to the best solutions. C. is the only way to analyze a policy. D. examines if the policy actually accomplished its goals.
Suppose that a country that has a high average wage level agrees to trade with a country that has a low average wage level. Which country can benefit?
a. only the one with a low level of output per person. b. only the one with a high level of output per person. c. both d. neither