The price elasticity of demand is measured by the
A. percentage change in quantity demanded divided by the percentage change in price.
B. change in price divided by the change in quantity demanded.
C. percentage change in price divided by the percentage change in quantity demanded.
D. change in quantity demanded divided by the change in price.
Answer: A
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Use the following graph to answer the next question.
This perfectly competitive firm will not produce unless price is at least
A. $7. B. $5. C. $2. D. $10.
Refer to Figure 2-13. If the two countries have the same amount of resources and the same technological knowledge, which country has an absolute advantage in the production of both pineapples and coconuts?
A) neither country B) Costa Rica C) Guatemala D) cannot be determined
If MPC = 0.75, a $40 billion decrease in government purchases would have what size effect on the "first round" of induced added consumption? a. It would increase first round consumption by $30 billion
b. It would increase first round consumption by $40 billion. c. It would increase first round consumption by $120 billion. d. None of the above; the first round effect would be a decrease in consumption.
Unions have the power to
A. set all working rules. B. increase the firm’s total taxes. C. push wages above competitive levels at times. D. make a firm nationalized.