All other things being equal, the __________ the percentage of one's budget spent on a good, the __________ the price elasticity of demand.
A) greater; higher
B) smaller; lower
C) greater; lower
D) smaller; higher
E) a and b
Answer: E) a and b
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In the above figure, when 2000 bicycles are produced each month, we can see that
A) the marginal benefit from another bicycle is greater than the marginal cost of another bicycle. B) more bicycles should be produced to reach the allocatively efficient level of output. C) the economy is very efficient at the production of bicycles because the marginal benefit exceeds the marginal cost. D) Both answers A and B are correct.
Being a price taker, a perfectly competitive firm cannot receive a producer surplus in the short run
Indicate whether the statement is true or false
Consumers do not prefer gifts-in-kind to cash gifts
What will be an ideal response?
The monetary policies carried out by the Fed
a. must be ratified by Congress. b. must be consistent with fiscal policies passed by Congress. c. are sometimes inconsistent with fiscal policy. d. must be approved by the president.