Inferior goods have an income elasticity of demand that is
a. positive
b. negative
c. 0
d. greater than 1 in absolute value
e. equal to 1 in absolute value
B
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The Pareto Unanimity axiom in Arrow's theorem implies that Arrow believes social choice processes should choose only pareto efficient outcomes.
Answer the following statement true (T) or false (F)
All Union Bank pays $120,000 from its reserves to buy the corporate bonds of a leading real estate firm from Smith and Kim Bank. Smith and Kim Bank keeps the amount in its vault as reserves. In the given scenario, which of the following statements is true? a. $120,000 will be added as an asset for Smith and Kim Bank, while $120,000 will be added as a liability for All Union Bank. b. $120,000
will be added as a liability for Smith and Kim Bank, while $120,000 will be added as an asset for All Union Bank. c. The liabilities of both Smith and Kim Bank and All Union Bank will increase by $120,000. d. There will be no change in the value of assets or liabilities of both the banks.
A decrease in the expected price level shifts short-run aggregate supply to the
a. right, and an increase in the actual price level shifts short-run aggregate supply to the right. b. right, and an increase in the actual price level does not shift short-run aggregate supply. c. left, and an increase in the actual price level shifts short-run aggregate supply to the left. d. left, and an increase in the actual price level does not shift short-run aggregate supply.
In the above graphs, which of the following remains constant as the money supply increases?
a. price level
b. interest rate
c. aggregate demand
d. real gross domestic product