The pair of items that is likely to have the LARGEST positive cross-price elasticity of demand is:
A) coffee and tea.
B) skis and ski boots.
C) pizza and pepperoni.
D) milk and cookies.
Answer: A) coffee and tea.
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The difference between a firm's assets and its liabilities is known as:
A) limited liability B) stock C) equity D) profit
The Romer model is distinct from the Solow model in that the former assumes that ________
A) technology is fixed B) an increase in price affects quantity demanded, rather than demand C) some labor is devoted to producing new technology D) output per worker is fixed
Based on the U.S. historical experience with the gold standard, we can conclude that
A) the gold standard guarantees price stability but not economic stability. B) the standard guarantees economic stability but not price stability. C) the gold standard guarantees both economic and price stability. D) the gold standard guarantees neither economic nor price stability.
Suppose a monopoly faces an inverse demand curve of P = 100 ? 2Q and has constant marginal cost of 6Q. If the government is considering legislation that would regulate price to the competitive level, what is the maximum amount the monopoly would spend on (legal) lobbying activities designed to thwart the regulation?
A. $500 B. $62.50 C. $562.50 D. None of the answers is correct.