At a price of $5, Sam buys 10 units of a product; when the price increases to $6, Sam buys 8 units. Martha says Sam's demand has decreased. Is Martha correct?
a. Yes, Martha is correct. Sam's demand has decreased.
b. No, Martha is incorrect. Sam's demand has increased.
c. No, Martha is incorrect. Sam's quantity demanded has decreased, and his demand has not changed.
d. No, Martha is incorrect. Sam's quantity demanded has increased, and his demand has increased.
e. No, Martha is incorrect. Sam's demand has increased, and his quantity demanded has decreased.
c
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The marginal principle states that one should
A) increase the level of an activity if the marginal benefit exceeds its marginal cost. B) if possible, pick the level at which the marginal benefit equals the marginal cost. C) decrease the level of an activity if the marginal cost exceeds the marginal benefit. D) all of the above
Why does the government intervene in the market for research, especially medical research?
What will be an ideal response?
When a manufacturer's home currency appreciates substantially,
a. domestic sales decline b. foreign sales decline c. company-owned foreign plant and equipment will increase d. margins often decline e. all of the above
To close an inflationary gap through fiscal policy, the government should
a. decrease government spending in order to reduce aggregate demand. b. increase government spending and taxes in order to both increase aggregate demand and aggregate supply. c. decrease government spending in order to increase aggregate supply. d. reduce taxes in order to stimulate investment, and thus increase aggregate supply.