Necessities tend to have more inelastic demands than luxuries
Indicate whether the statement is true or false
TRUE
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A good or service or a resource is nonrival if
A) it is possible to prevent someone from enjoying its benefits. B) it is not possible to prevent someone from enjoying its benefits. C) its use by one person decreases the quantity available for someone else. D) its use by one person does not decrease the quantity available for someone else.
Melon Computer Company manufacturers its computer components in Singapore and assembles the computers intended for sale in North America in its plant in Arizona. If the U.S
reduces the corporate income tax rate next year, what is the likely outcome for Melon Computer Company? A) Reduce the transfer price for computer components and increase downstream profits B) Reduce the transfer price for computer components and decrease downstream profits C) Increase the transfer price for computer components and increase downstream profits D) Increase the transfer price for computer components and decrease downstream profits
A long run equilibrium: a. Will be at a greater output level than the natural level of real output. b. Will be at the natural level of real output
c. Will be at a smaller output level than the natural level of real output. d. Long-run equilibrium could be at any of the above levels of output.
Suppose a central bank tries to keep exchange rates fixed. When there is an increase in the demand for foreign goods, the central bank will most likely
A) buy foreign currency in exchange for the domestic currency. B) do nothing. C) sell the domestic currency in exchange for foreign reserves. D) use foreign reserves to buy the domestic currency.