For which pairs of goods is the cross-price elasticity most likely to be negative?
a. peanut butter and jelly
b. celery and coffee
c. pens and pencils
d. iPods and iPads
a
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Suppose the shift from AD0 to AD1 and from AS0 to AS1 is the result of fiscal policy
If the effect on aggregate supply was larger than the figure above shows, as a result the price level would be ________ 110 and real GDP would be ________ $17 trillion. A) equal to; equal to B) equal to; larger than C) higher than; larger than D) smaller than; less than E) smaller than; larger than
Changing the discount rate
a. provides a signal that the Fed wants to encourage an expansion or contraction of the money supply. b. is usually done in large increments in order to have a rapid impact on business activity. c. is primarily remedial rather than preventive. d. is a function of the Federal Reserve Banks without any review by the Board of Governors.
For a certain firm, the 100th unit of output that the firm produces has marginal revenue equal to $10 and a marginal cost of $7 . It follows that
a. the production of the 100th unit of output increases the firm's profit by $3. b. the production of the 100th unit of output increases the firm's average total cost by $7. c. the firm's profit-maximizing level of output is less than 100 units. d. the production of the 110th unit of output must increase the firm's profit by less than $3.
How is inflation related to interest rates?
What will be an ideal response?