If income increases by 10% and, in response, the quantity of housing demanded increases by 7%, then the income elasticity of demand for housing is
A. -1.
B. -0.7.
C. 0.7.
D. 1.43.
Answer: C
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If the Fed wanted to prevent a change in money demand from affecting real GDP, which of the following responses would it choose?
a. A neutralization response b. A constant interest rate response c. A constant money supply response d. A constant tax rate response e. A constant government spending response
Which statement about loans is true?
a. Banks use their secondary reserves to make loans. b. When banks loan money to borrowers, they make the economy more liquid. c. By creating loans, banks decrease demand deposits. d. When a loan is made, the borrower experiences an increase in wealth.
In 2011, the 20 percent of families with the lowest incomes paid an average federal tax rate (on all federal taxes) of about ________, whereas the 20 percent of families with the highest incomes paid an average tax rate of about ________.
A. 8.4 percent; 29 percent B. 10.3 percent; 30.9 percent C. 4.0 percent; 35 percent D. 1.9 percent; 23.4 percent
________ is (are) most likely a variable cost for a firm.
A. Monthly health insurance expenses for employees B. The monthly lease payment on a delivery truck that is leased for three years C. The plumbing company's annual licensing fee D. The quarterly payments for a two-year maintenance contract for copy machines