If C = 100 + 0.8Y and I = 50, then the equilibrium level of income is
A. 187.5.
B. 375.
C. 600.
D. 750.
Answer: D
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The income elasticity of demand for movies in the United States is 3.41. If people's incomes decrease by 1 percent, what is the decrease in the quantity of movies demanded?
What will be an ideal response?
Managers of profit centers earn more when their divisions
a. increase their sales and decrease their costs a. decrease their sales and increase their costs b. increase the costs of the components for which they are responsible c. none
Explain the impact on the domestic economy of an import quota on oranges.
What will be an ideal response?
Health insurance companies face an asymmetric information problem because:
A. insurance companies have superior information concerning the risk of illness or injury of those insured. B. buyers have superior information concerning their risk of illness or injury. C. the insurance companies and buyers both have equal information concerning the risk of illness or injury of those insured. D. the probability of becoming ill or injured is unrelated to the insured person's occupation.