If the elasticity of supply coefficient for a good is one-sixth (in absolute terms), we know:
a. that for every 1% increase in quantity, there will be a 6% increase in price.
b. that for every 1% increase in quantity, there will be a 6% decrease in price.
c. that for every 6% increase in quantity, there will be a 1% increase in price.
d. that for every 6% increase in quantity, there will be a 1% decrease in price.
a
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Today, the United States is a
I. net borrower. II. net lender. III. debtor nation. IV. creditor nation. A) I and IV B) II and IV C) I and III D) II and III
If the MPC is 0.8, then the MPS is
A) 0.2. B) 1. C) 5. D) 8.
Under adaptive expectations, the short-term effect of an unanticipated shift to a more expansionary macroeconomic policy will be a:
A. temporary reduction in the unemployment rate. B. permanent reduction in the unemployment rate. C. temporary reduction in the inflation rate. D. permanent reduction in the inflation rate.
Which of the following features does a free-trade area necessarily have?
A. Absence of trade barriers among the member nations B. Harmonization of all economic policies C. Free movement of factors of production across the member nations D. Equal tariff rates