In which regions do recessions, or economic downturns, hit the hardest?
a. Regions that produce more consumer goods.
b. Regions that produce more nondurable goods.
c. Regions that provide more financial services.
d. Regions that produce more capital goods and rely on more housing construction.
d
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Suppose the price of skateboards were to fall. Other things constant, what is the least likely to occur?
A) More skateboards will be purchased. B) The demand for skateboards will increase. C) More helmets will be purchased. D) The demand for helmets will increase.
The above table gives Sue's marginal utility schedules for sub sandwiches and Mountain Dew, the only products Sue consumes. Suppose initially the price of a sub sandwich is $4 each and the price of a Mountain Dew is $2 each. Sue's income is $12
If the price of subs rises to $6 each, Sue will consume A) more Mountain Dews. B) fewer subs. C) fewer Mountain Dews so that she can still afford to buy two subs. D) Both answers A and B are correct.
Suppose that the interest rate paid to savers increases. As a result, Tom wishes to save more. This suggests that, for Tom,
A) the substitution effect is greater than the income effect. B) the income effect is greater than the substitution effect. C) utility maximization is not occurring. D) future consumption is a luxury.
In the short run, the monopolistic competitor is just like the perfect competitor in that
A) equilibrium is determined by setting price equal to marginal cost. B) either type of firm can earn economic profits, experience economic losses, or break even in the short run. C) each equates marginal revenue and marginal cost in order to maximize profits, with the result that price exceeds marginal revenue. D) new firms enter in the short run when firms are making profits.