Identify the factors that affect elasticity of demand
What will be an ideal response?
-Availability of Substitutes
-Relative Importance
-Necessities Versus Luxuries
-Change Over Time
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Describe why monetary policy rules are superior to discretionary monetary policy
What will be an ideal response?
Suppose a perfectly competitive increasing-cost industry is in long-run equilibrium when market demand suddenly increases. What happens to the typical firm in the long run?
a. It experiences no change from the original equilibrium b. It experiences a higher average total cost and equilibrium price c. It experiences a lower average total cost and equilibrium price d. It experiences the same equilibrium price but a greater average total cost e. It experiences the same equilibrium price but a lower average total cost
Discretionary fiscal policy in the form of an increase in government spending or a decrease in taxes can be used to close an expansionary gap
Indicate whether the statement is true or false
Refer to the accompanying table. Corey's opportunity cost of making of a pizza is delivering: Pizzas Made Per HourPizzas Delivered Per HourCorey126Pat1015
A. 1/2 of a pizza. B. 2 pizzas. C. 3/2 of a pizza. D. 2/3 of a pizza.