The number of cases of Coca-Cola bought increased by 50 percent when the price of pretzels declined by 10 percent. Assuming other factors are held constant, Coca-Cola and pretzels are classified as:
a. complements.
b. unrelated goods.
c. substitutes.
d. social goods.
a
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The term ceteris paribus is an economic assumption that means
A) let the buyer beware. B) common sense is reality. C) the detail is in the interrelationship. D) other things being equal.
When the price ceiling on eggs is lifted, there is a shortage of eggs in the market
a. True b. False Indicate whether the statement is true or false
If the annual real interest rate on a 10-year inflation-protected bond equals 1.5 percent and the annual nominal rate of return on a 10-year bond without inflation protection is 4.2 percent, what average rate of inflation over the ten years would make holders of inflation-protected bonds and holders of bonds without inflation protection equally well off?
A. 4.2 percent B. 2.7 percent C. 1.5 percent D. 5.7 percent
______ involves purchases that add to the stocks of goods kept by the firm to meet consumer demand.
a. Durable investment b. Capital investment c. Inventory investment d. Fixed investment