List and describe the three functions of money
Money serves as a medium of exchange, a unit of account and a store of value. Medium of exchange: In a money economy, money serves as the medium through which transactions are made. Unit of account: Money is the common standard by which value is determined in a money economy (a "yardstick" of value). Store of value: Money will retain value over time.
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Cross-price elasticity of demand is calculated as the
A) percentage change in quantity sold divided by percentage change in buyers' incomes. B) percentage change in quantity supplied divided by percentage change in price of a good. C) percentage change in quantity demanded of one good divided by percentage change in price of a different good. D) percentage change in quantity demanded divided by percentage change in price of a good.
Market economies are likely to suffer from recessions and inflation because the government plans all economic activity
a. True b. False Indicate whether the statement is true or false
Exhibit 9-2 Demand and cost information for a monopoly Q P TC 0 40 10 1 30 15 2 20 25 3 10 40 4 0 60 Refer to Exhibit 9-2. Using the rule that focuses on the marginal approach to maximizing profits, the monopolist maximizes profit by choosing price equal to:
A. $40. B. $20. C. $10. D. $30.
An indifference map implies that:
A. money income is constant, but the prices of the two products vary directly with the quantities purchased. B. the two products under consideration are perfectly substitutable for one another. C. a consumer is better off to be at some point high on a given curve as opposed to a point low on the same curve. D. curves farther from the origin yield higher levels of total utility.