Suppose all prices decrease by 10 percent in the year while the total sales of smartphones remain constant. This is
A. a violation of the law of demand since fewer smartphones should be purchased at a higher price.
B. not a violation of the law of demand since the relative price of smartphones did not change.
C. not a violation of the law of demand since the law of demand does not apply to expensive goods like smartphones.
D. a violation of the law of demand since more smartphones should have been purchased with higher incomes.
Answer: B
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Use the following information to answer the next question.Maya purchases only three products; orange juice, prepared meals, and on-demand episodes of her favorite shows. Each week she purchases 2 bottles of orange juice, 14 prepared meals, and 8 on-demand episodes. The prices of bottles of orange juice, prepared meals, and on-demand episodes for four different years are shown in the table below.YearPrice of Orange JuicePrice of Prepared MealsPrice of On-Demand Episodes1$2$6$102$6$5$123$4$7$134$4$8$11Based on this information, which of the following statements is true?
A. Maya spent $10 less in Year 1 than in Year 2. B. Maya's buying power increased between Year 1 and Year 4. C. There was inflation from Year 3 to Year 4. D. Maya's purchases cost $30 more in Year 3 than in Year 2.
What would be the best description of what we assume about money prices in the short run?
A) Money prices of goods and services vary. B) Money prices of goods and services not related to each other. C) Money prices of goods are fixed. D) Money prices of services are fixed. E) Money prices of goods and services are only temporarily fixed.
Three-wheel cars made in North Edsel are sold for 5000 pounds. Four-wheel cars made in South Edsel are sold for 10,000 marks. The real exchange rate between North and South Edsel is four three-wheel cars for three four-wheel cars
The nominal exchange rate between the two countries is A) 0.50 marks/pound. B) 0.66 marks/pound. C) 1.50 marks/pound. D) 2.00 marks/pound.
Compared to the perfectly competitive firm, the monopolist's input demand curve is
A) more elastic. B) more inelastic. C) due to a constant per-unit price of the product. D) marginal factor cost.