During 2008 in the United States, consumer confidence fell significantly. Which of the following will occur as a result of this reduction in consumer confidence?
A) The LM curve will shift up.
B) The LM curve will shift down.
C) The IS curve will shift rightward.
D) The IS curve will shift leftward.
E) The IS curve will shift rightward, and the LM curve will shift up.
D
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If a 5 percent change in the price of a good leads to a 10 percent change in the quantity supplied, then the supply of the good is ________ and the elasticity of supply is ________
A) inelastic; 0.5 B) inelastic; 2.0 C) elastic; 0.5 D) elastic; 2.0
Financial innovation has caused
A) banks to suffer declines in their cost advantages in acquiring funds, although it has not caused a decline in income advantages. B) banks to suffer a simultaneous decline of cost and income advantages. C) banks to suffer declines in their income advantages in acquiring funds, although it has not caused a decline in cost advantages. D) banks to achieve competitive advantages in both costs and income.
Human capital theory suggests that everyone's income reflects individual choices about investments in education and training
Indicate whether the statement is true or false
Last year, Alice bought 40 CDs when her income was $20,000 . This year, her income increased to $25,000 . and she purchased 48 CDs. We can conclude that:
a. Alice's price elasticity of demand for CDs is equal to 1. b. Alice's demand for CDs is price-inelastic. c. Alice's demand for CDs is price-elastic. d. the income elasticity of demand for CDs is negative. e. CDs are a normal good.