Is demand for electricity more price elastic when measured over a short period of time or a long period of time? Explain.
What will be an ideal response?
It is more price elastic over a long period of time because there are more substitutes in a long period of time. If electricity prices get high people have little choice but to pay them in the short run. In the long run people can invest in solar heat, use gas stoves, add insulation, and do other things to reduce their consumption of electricity. Since there are more substitutes in the long run the elasticity is higher.
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A) Pablo was better off in 2011 because his weekly wage was higher. B) the 2001 wage measured in 2011 dollars is $157.89. C) the 2011 wage measured in 2001 dollars is $157.89. D) the 2001 wage measured in 2011 dollars is $131.58. E) the 2001 wage measured in 2011 dollars is $100.
The Fed has control over the long-term real interest rate provided that three variables remain unchanged. These three variables include all of the following except
A) the expected rate of inflation. B) the default premium. C) term structure effects. D) the short-term real interest rate.
The present value of receiving M dollars in year t when the prevailing interest rate is i is equal to
a. M - it b. M ? (1 - i)t c. M/(1 + i)t d. M ? it e. M/it
When a patent is awarded, no one but the patent owner may produce the invention without his permission
a. True b. False Indicate whether the statement is true or false