If the percentage change in quantity demanded for a good is larger than the percentage change in its price, then the price elasticity of demand of the good is said to be:
a. elastic
b. inelastic.
c. perfectly inelastic.
d. unit elastic.
a
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The table above gives four production possibilities for airplanes and cruise ships. In possibility A, how many resources are devoted to the production of cruise ships?
A) 0 B) few C) most D) all E) It is impossible to tell without more information about the prices of airplanes and cruise ships.
Private saving is positive when:
A. the government's budget is balanced. B. there is a government budget surplus. C. there is a government budget deficit. D. after-tax income of households and businesses is greater than consumption expenditures.
"Monopolistic competition is literally a kind of competition. Hence, there is no deadweight loss in a monopolistically competitive market."
A. The statement is incorrect. B. The statement is by definition correct but empirically incorrect. C. The statement is correct. D. None of the answers is correct.
If real salaries increase but nominal salaries do not, this means that:
A. the purchasing power of money has decreased. B. prices have not changed. C. prices have risen. D. prices have fallen.