The income elasticity of demand for low-quality beef is -2. Thus, an 8% decrease in the quantity of low-quality beef demanded
A. is the result of an increase in income of 4%.
B. is the result of an increase in income of 0.25%.
C. is the result of a decrease in income of 4%.
D. is unrelated to any change in income.
Answer: A
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Which of the following events led to the debate over the applicability of the classical model?
a. World War II b. World War I c. Korean War d. The Great Depression e. The Great Society
The goal of all regulation is the creation of perfectly competitive markets.
Answer the following statement true (T) or false (F)
A city wants to raise revenues to build a new municipal swimming pool next year. The mayor suggests that the city raise the price of admission to the current municipal pools this year to raise revenues. The city manager suggests that the city lower the price of admission to raise revenues. Who is correct?
a. Both the mayor and city manager would be correct if demand were price elastic. b. Both the mayor and city manager would be correct if demand were price inelastic. c. The mayor would be correct if demand were price elastic; the city manager would be correct if demand were price inelastic. d. The mayor would be correct if demand were price inelastic; the city manager would be correct if demand were price elastic.
Which of the following are three key components of the economic problem?
a. scarcity; choice; giving up valuable opportunities b. surplus; choice; competing opportunities c. scarcity; competing opportunities; income d. surplus; income; giving up valuable opportunities