Suppose the price of X increases by 10 percent while the quantity demanded of Y does not change. We would conclude that
A) the two goods are substitutes, but the cross elasticity of demand is not large.
B) the two goods are complements, but the cross elasticity of demand is not large.
C) the two goods are perfect substitutes.
D) the two goods are not related.
D
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A market with demand Q = 100 - 3P is currently in equilibrium with 40 units being sold. It follows that the current price elasticity of demand
a. is zero. b. is -1.5. c. is -6. d. cannot be calculated with the information given.
A country will have a balance-of- payments deficit when its exchange rate:
A. equals the market equilibrium value. B. is undervalued. C. is overvalued. D. is flexible.
Sherry wants to rent an apartment. Although rents are below what she is willing to pay, she cannot find an apartment. Then after a month of searching, she finds an apartment but she has to pay an additional $1,000 to have the locks changed
Sherry has just experienced the effects of ________. A) a rent floor with a black market B) inelastic demand C) a market working efficiently D) a rent ceiling
Suppose Bank A holds $200 of reserves, has deposits of $1000, and the desired reserve ratio is 20 percent. How many deposits can Bank A create?
A) zero, because Bank A has no excess reserves B) $200 C) $800 D) $400