If a 10% increase in the price of one good results in no change in the quantity demanded of another good, then it can be concluded that the two goods are
A. complements.
B. substitutes.
C. inferior.
D. unrelated.
Answer: D
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In a competitive industry some firms earn positive economic profits while some earn zero economic profit in the long run because:
A) there exists free entry and exit of firms. B) the firms have different cost structures. C) the firms sell their output at different prices. D) the industry supply curve is perfectly elastic.
The figure above gives your budget line for magazine and CDs per month. Given that your income equals $60 per month, what is your real income in terms of magazines?
A) 12 magazines B) 6 magazines C) 2 magazines D) $60/month
Consider a system in which a person earning $10,000 pays $1,000 in taxes, a person earning $25,000 pays $1,000 in taxes and a person earning $60,000 pays $1,000 in taxes. What type of tax is this?
a. progressive b. proportional c. regressive d. transgressive e. unfair
Which of the following would cause the demand curve for DVDs to shift to the right?
a. a decrease in the price of DVDs b. a decrease in the price of DVD players c. a change in the tastes towards watching movies in movie theaters d. a decrease in the number of people in the market for DVDs