The price elasticity of demand for beef is about 0.60. Other things equal, this means that a 20 percent increase in the price of beef will cause the quantity of beef demanded to:
A. increase by approximately 12 percent.
B. decrease by approximately 12 percent.
C. decrease by approximately 32 percent.
D. decrease by approximately 26 percent.
Answer: B
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If an increase of $10 billion of investment results in an increase in equilibrium expenditure of $40 billion, the multiplier equals
A) $10 billion ÷ $40 billion = 0.25. B) $40 billion - $10 billion = $30 billion. C) $10 billion × $40 billion = $400 billion. D) $10 billion - $40 billion = -$30 billion. E) $40 billion ÷ $10 billion = 4.
If an airport decides to expand by building an additional passenger terminal, and in doing so it lowers its average cost per airplane landing, it was previously operating at
A) more than minimum efficient scale. B) minimum capacity. C) less than minimum efficient scale. D) minimum efficient scale.
If prices rise within a country, then, other things equal, the value of a unit of domestic currency will:
a. rise in both the domestic and the foreign exchange markets. b. fall in both the domestic and the foreign exchange markets. c. rise in the domestic market and fall in the foreign exchange market. d. fall in the domestic market and rise in the foreign exchange market. e. fluctuate unpredictably in both domestic and foreign exchange markets.
Employment can remain the same while the labor force participation rate decreases if unemployment ______________
What will be an ideal response?