Suppose the demand for X is given by Qxd = 100 - 2PX + 4PY + 10M + 2A, where PX represents the price of good X, PY is the price of good Y, M is income and A is the amount of advertising on good X. Good X is
A. a Giffen good.
B. an inferior good.
C. a complement.
D. a normal good.
Answer: D
You might also like to view...
A(n) ________ in U.S. interest rates will cause an increase in the demand for U.S. dollars and a(n) ________ in the (per dollar) exchange rate
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
One reason investors may prefer bonds over stocks is
a. potential profits are larger b. bond prices never vary c. bondholders get paid before stockholders d. owning bonds implies owning a part of the company e. interest rates do not affect the value of bonds
Economists assume that most people a. act purposefully
b. make decision with some expected outcome in mind. c. make choices that are not random and chaotic. d. all of the above.
An increase in the money supply might indicate that the Fed had
a. purchased bonds in an attempt to increase the federal funds rate. b. purchased bonds in an attempt to reduce the federal funds rate. c. sold bonds in an attempt to increase the federal funds rate. d. sold bonds in an attempt to reduce the federal funds rate.