If all countries produce the same good (or the same set of goods) and goods are freely traded among countries, so that the real exchange rate equals one, then the relationship between domestic and foreign prices and the nominal exchange rate is
A. P = enom / PFor.
B. P = PFor.
C. enom = P × PFor.
D. P = PFor / enom.
Answer: D
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The word "util" has been used by economists in the past as an objective measure of utility. Today economists believe that
A) the util truly is an objective, rather than a subjective, measure of utility. B) utility can be measured objectively because people can use prices of different goods to measure utility. C) utility cannot be measured objectively. D) all of the important conclusions of the economic model of consumer behavior depend on utility being measured objectively.
The expected-profit-maximization rule sets ________ equal to ________ and is an ________
A) marginal revenue; expected marginal cost; operational guideline B) expected marginal revenue; expected marginal cost; operational guideline C) expected marginal revenue; marginal cost; operational guideline D) marginal revenue; marginal cost; easily obtainable goal
Price floors are sometimes called price supports because they prevent a price from falling below a certain level
a. True b. False Indicate whether the statement is true or false
Suppose that 50 hot dogs are demanded at a particular price. If the price of hot dogs rises from that price by 5 percent, the number of hot dogs demanded falls to 48 . Using the midpoint approach to calculate the price elasticity of demand, it follows that the
a. demand for hot dogs in this price range is unit elastic. b. price increase will decrease the total revenue of hot dog sellers. c. price elasticity of demand for hot dogs in this price range is about 1.22. d. price elasticity of demand for hot dogs in this price range is about 0.82.