Refer to Table 6-6. Based on the data in the table, between a price of $9.99 and $14.99, the demand for books is
A) elastic. B) inelastic. C) unit elastic. D) perfectly inelastic.
A
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The sum of the current account, capital and financial account, and official settlements account is
A) a positive number if the country has a trade surplus. B) a negative number if the country has a trade deficit. C) positive or negative depending on whether the domestic exchange rate is appreciating or depreciating. D) always equal to zero.
When the marginal social benefit of Good A is greater than the marginal private benefit of Good A, then
A) competitive, unregulated markets will produce a quantity of Good A that is less than the efficient quantity. B) competitive, unregulated markets will produce the quantity of Good A that is equal to the efficient quantity. C) competitive, unregulated markets will produce a quantity of Good A that is greater than the efficient quantity. D) the government should levy a tax on the production of Good A that is equal to the horizontal distance between the two marginal cost curves.
A perfectly competitive firm's short-run supply curve is
A) upward sloping and is the portion of the marginal cost curve that lies above the average total cost curve. B) upward sloping and is the portion of the marginal cost curve that lies above the average variable cost curve. C) perfectly elastic at the market price. D) horizontal at the minimum average total cost.
Refer to the graphs and information below. If Italy and Greece should open up trade with each other, which of the following terms of trade is mutually beneficial?
Suppose the world economy is composed of just two countries: Italy and Greece. Each can produce steel or chemicals, but at different levels of economic efficiency. The production possibilities curves for the two countries are shown in the graphs below.
A. 1 ton of chemicals = 1 ton of steel
B. 2 tons of chemicals = 1 ton of steel
C. 5 tons of chemicals = 2 tons of steel
D. 9 tons of chemicals = 5 tons of steel