If the price elasticity of demand for a product is 2.5, then a price cut from $2.00 to $1.80 will:
A. increase the quantity demanded by about 2.5 percent.
B. decrease the quantity demanded by about 2.5 percent.
C. increase the quantity demanded by about 25 percent.
D. increase the quantity demanded by about 250 percent.
Answer: C
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In the figure above, an increase in the quantity of oil supplied but NOT an increase in the supply of oil is shown by a movement from
A) point a to point e. B) point a to point b. C) point a to point c. D) point a to point d.
Refer to Figure 22-3. Which of the following would cause an economy to move from a point like A in the figure above to a point like B?
A) an increase in capital per hour worked B) a decrease in capital per hour worked C) an improvement in technology D) a technological regression
Macroeconomic equilibrium occurs when:
a. Expected supply equals expected demand. b. Expected leakages equal actual injections. c. Actual leakages equal expected injections. d. Actual supply equals actual demand and actual leakages equal actual injections. e. Expected amount supplied equals expected amount demanded, which means expected leakages equal expected injections.
The steeper an isoquant is,
A) the greater is the marginal productivity of labor relative to that of capital. B) the greater is the substitutability between capital and labor. C) the greater is the need to keep capital and labor in fixed proportions. D) the greater is the level of output.