Price elasticity of demand measures the
a. change in quantity demanded generated by a change in price
b. change in price generated by a change in quantity demanded
c. percentage change in the price of a good demanded generated by a percentage change in people's income
d. percentage change in quantity demanded generated by a percentage change in price
e. percentage change in price generated by a percentage change in quantity demanded
D
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Trade allows each country to take advantage of lower ___________ costs in the other country.
a. replacement b. opportunity c. marginal d. retail
If supply increases and demand does not change, then price
a. as well as quantities demanded and supplied will increase b. will decrease, and quantity demanded and supplied will increase c. will decrease, and quantity demanded and supplied will decrease d. and quantity demanded remain unchanged e. remains unchanged, but both quantities demanded and supplied will decrease If supply increases and demand does not change, then price
Inflation inertia is the tendency for inflation to:
A. increase when the Fed decreases interest rates. B. decrease when the Fed increases interest rates. C. change relatively slowly from year to year. D. equal zero.
Assume the market price for lemon grass is $4.00 per pound, but most buyers are willing to pay more than the market price. At the market price of $4.00, the quantity of lemon grass demanded is 1,500 pounds per month, and quantity demanded does not reach
zero until the price reaches $30.00 per pound. Construct a graph showing this data, calculate the total consumer surplus in the market for lemon grass, and show the consumer surplus on the graph. Your demand curve should be a straight line. What will be an ideal response?