The demand for flour is
a. inelastic because there are few substitutes for flour and it represents a large percentage of a consumer's budget
b. inelastic because there are many substitutes for flour and it represents a large percentage of a consumer's budget
c. inelastic because there are few substitutes for flour and it represents a small percentage of a consumer's budget
d. elastic because there are no substitutes for flour and it represents a large percentage of a consumer's budget
e. elastic because there are many substitutes for flour and it represents a large percentage of a consumer's budget
C
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If the expected future exchange rate decreases, then the supply of dollars ________ and the demand for dollars ________
A) increases; increases B) decreases; increases C) increases; decreases D) decreases; decreases E) does not change; does not change
When comparing the annual inflation rate in the United States based on the CPI with the annual inflation rate based on the PCE price index, the data show that the two inflation rates
A) move in opposite directions. B) remained constant over the forty year period after 1979. C) steadily increased over the forty year period after 1979. D) move up and down in similar but not identical ways. E) both fluctuate, but the fluctuations have little relationship to each other.
The figure above shows the cost, demand, and marginal revenue curves for a monopoly. The firm
A) will make an economic profit of $20. B) will charge a price of $10 per unit. C) will produce 20 units per day. D) is a natural monopoly.
A good with a price elasticity of demand equal to .75 is described as price-inelastic.
Answer the following statement true (T) or false (F)