Which of the following is most likely to lead to an increase in the rental price of apartments near your campus?
What will be an ideal response?
an unexpected increase in enrollment at your college
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A rational expectation of the inflation rate is
A) always correct. B) a forecast based on the forecasted actions of the Fed and other relevant determinant factors. C) a forecast based only on the historical evolution of inflation over the last 100 years. D) an expected inflation rate between 5 percent and 10 percent. E) an expected inflation rate between 1 percent and 5 percent.
The income elasticity of demand is
A) positive for a normal good. B) zero for an inferior good. C) less than one for an income elastic normal good. D) Only answers A and B are correct. E) Answers A, B, and C are correct.
The reason that supply and demand tend to be more price elastic over longer time periods is because
A) it takes time for households and businesses to adjust to price changes. B) some goods have longer shelf life and are reordered less often. C) firms incur costs in changing the price of goods on their shelves. D) the feedback loop from buyers to sellers takes time.
According to the graph shown, if the economy is in autarky and decides to open trade with a tariff, the impact on domestic supply is they will:
This graph demonstrates the domestic demand and supply for a good, as well as a tariff and the world price for that good.
A. increase output from 250 to 500.
B. decrease output from 815 to 500.
C. increase output from 500 to 815.
D. decrease output from 1500 to 1150.