Assume an analyst has been hired to estimate the price elasticity of demand for hamburger (which sells for about $2.30 per pound) and filet mignon (which sells for about $20 per pound), respectively
Considering the different determinants of the price elasticity of demand and assuming the consumers in both markets have approximately the same incomes, we would expect the coefficient of price elasticity of demand in absolute value to be: A) larger for hamburger than for filet mignon.
B) larger for filet mignon than for hamburger.
C) approximately the same for both hamburger and filet mignon.
D) none of the above because different determinants would have opposing effects on the two estimates.
B
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Refer to the scenario above. Suppose Edwin consumes the total output produced. What is likely to happen in this case?
A) GDP will remain unchanged. B) GDP will decrease. C) Trade surplus will increase by $200. D) GDP will increase.
Any supplement to consumer spending that increases domestic aggregate output and income is called a leakage
Indicate whether the statement is true or false
The Phillips curve
a. is the same as a country's production possibilities frontier.. b. is upward sloping. c. illustrates the Fed's choice between inflation and unemployment in the long run. d. illustrates the Fed's choice between inflation and unemployment in the short run. e. illustrates the Fed's choice between inflation and tax revenues in the short run.
Fiscal federalism refers to
a. passing money from one level of government to another. b. leaving indirect taxes to the states. c. keeping property taxes low. d. making all levels of government operate on a "pay as you go" basis.