As part of recent cutbacks, Paul just accepted a 10% cut in pay. Now he brews coffee at home instead of stopping at Starbucks every day. Based on this behavior, we can say home-brewed coffee:
A. is a normal good, and Starbucks coffee is an inferior good for Paul.
B. and Starbucks coffee are normal goods for Paul.
C. will become a normal good for Paul over time.
D. is an inferior good, while Starbucks coffee is a normal good for Paul.
D. is an inferior good, while Starbucks coffee is a normal good for Paul.
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The biggest barrier to growth for many of the poorest countries in the world is the need for:
A. more physical capital. B. larger populations. C. more human capital. D. improved legal and political frameworks.
Each year Apple Computers produces a new line of IPods with greater storage capacity and more features. Sales continue to soar even though the prices each year rise as well
Is this a refutation of the law of demand or is there something else going on here that doesn't meet the eye?
As the number of substitutes for a good increases, the absolute value of its own-price elasticity
a. stays the same b. increases c. decreases d. the good becomes perfectly inelastic.
Which of the following will make the real-world money multiplier smaller than the theoretical formula?
a. Banks actually hold fewer reserves than technically required by the Fed. b. Banks actually make loans for more money than they have in excess reserves. c. Banks may keep some excess reserves rather than loan it all out. d. Both a. and b. above are correct.