The cross elasticity of demand for pizza with respect to the price of a soda is
A) positive because the goods are complements.
B) negative because the goods are complements.
C) positive because the goods are substitutes.
D) negative because the goods are substitutes.
B
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Use the following figure to answer the next question.
In the figure, AD2 and AS2 represent the original aggregate supply and demand curves. If Q3 is full-employment output, then AD2 and AS1 best represent a period of ________.
A. hyperinflation B. expansion C. low unemployment D. stagflation
By hedging a portfolio, a bank manager
A) reduces interest-rate risk. B) increases reinvestment risk. C) increases exchange-rate risk. D) increases the probability of gains.
Which statement is false?
A. The two basic ways that unions have of exerting power is inclusion and exclusion. B. A smaller percentage of the labor force is members of unions today than 35 years ago. C. Collective bargaining is the main arena of the power struggle between labor and management. D. None of the statements are false.
Which of the following would show a good that is relatively elastic in supply?
a. ES ÷1 b. ES = 1 c. ES ? 1 d. ES < 1