Answer the following statement(s) true (T) or false (F)
1. The price elasticity of supply measures the relative change in the quantity consumers demand that results from a change in price.
2. The price elasticity of supply is defined as the percentage change in the quantity supplied multiplied by the percentage change in price.
3. In a condition of perfectly inelastic supply, an increase in price will not change the quantity supplied.
4. In a condition of perfectly elastic supply, the elasticity of supply is 100.
5. Supply is usually more elastic in the short run than in the long run.
1. False
2. False
3. True
4. False
5. False
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Based on the figure below. Starting from long-run equilibrium at point C, a favorable inflation shock that decreases inflation from ? to ?1 will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies. 
A. A; C B. B; A C. B; C D. A; B
Which of the following factors may lead to a decline in the real value of money?
a. Increase in the rate of interest b. Decline in aggregate demand in the economy c. Decrease in money supply d. Increase in the average price level e. Decrease in aggregate output
A bank's capital is: a. the value of all its assets, including loans
b. the value of all its assets, excluding loans. c. the value of its physical plant, including buildings, computers, and automatic teller machines. d. the difference between its assets and liabilities.
Economically speaking, tariffs are
a. a means to promote economic efficiency. b. necessary to keep the industries of an economy healthy. c. the same as import quotas. d. obstacles that limit voluntary exchange.