Suppose the quantity demand of a product increases from 32 units to 40 units and income increases from €20,000 to €22,000. What is the Income Elasticity of Demand?
a) 0.4.
b) -0.4.
c) - 2.5.
d) 2.5.
Answer: d) 2.5.
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A pay-as-you-go system means
A. you pay for your dinner as you go to the table to eat. B. current working citizens pay for current retired citizens. C. there is no need for taxes since current workers pay for current retirees. D. retirees are paid from accounts that have accumulated with interest over their working lives.
A budget line is the locus of all points representing every input combination of inputs that the producer can afford to buy with a given amount of money and given input prices
a. True b. False Indicate whether the statement is true or false
To say that a firm is competitive in the labor market is to say that the firm can choose
a. both the wage it pays its workers and the number of workers it hires. b. neither the wage it pays its workers nor the number of workers it hires. c. the wage it pays its workers, but it cannot choose how many workers to hire. d. the number of workers it hires, but it cannot choose the wage it pays its workers.
For an imaginary economy, the consumer price index was 80 in 2014, 100 in 2015, and 140 in 2016 . Which of the following statements is correct?
a. If the basket of goods that is used to calculate the CPI cost $40 in 2014, then that basket of goods cost $60 in 2015. b. If the basket of goods that is used to calculate the CPI cost $25 in 2015, then that basket of goods cost $35 in 2016. c. The overall level of prices increased by 60 percent between 2014 and 2016. d. All of the above are correct.