How is the price-change formula to predict the change in the equilibrium price resulting from a change in demand calculated?
A. by dividing the percentage change in price by the sum of the price elasticities of supply and demand
B. by dividing the percentage change in demand by the sum of the price elasticities of supply and demand
C. by dividing the percentage change in supply by the sum of the price elasticities of supply and demand
D. by dividing the percentage change in income by the sum of the price elasticities of supply and demand
Answer: B
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Everything else held constant, when a country's currency appreciates, the country's goods abroad become ________ expensive and foreign goods in that country become ________ expensive
A) more; less B) more; more C) less; less D) less; more
If the price of apples decreases by 2 percent and causes apple consumption to increase by 4 percent, the price elasticity of demand is ____, indicating the demand is ____
a. 2, elastic b. 2, inelastic c. 0.5, elastic d. 0.5, inelastic
When the average price level in the United States, relative to the average price level in other countries, falls, this tends to
A. raise imports and exports. B. lower imports and exports. C. raise imports and lower exports. D. lower imports and raise exports.
In the scenario above, as a result of increased advertising, Talbot's average total cost
A) falls by $20 per coat. B) rises by $50 per coat. C) rises by $30 per coat. D) falls by $40 per coat.