If the price elasticity of demand is 4 and the price of migraine medicine increases by 6%, what will be the percentage change in quantity demanded?
a. 6%
b. 4%
c. 24%
d. 67%
c. 24%
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A homeowner making a mortgage payment is paying
A) a sunk cost which is consequently not a genuine cost at all. B) the cost of borrowing to purchase the house. C) the cost of constructing the house. D) the cost of purchasing the house. E) the cost of retaining ownership of the house.
Which type of stock should result in the best return according to the Efficient Markets Hypothesis?
A) a firm that is expected to be highly profitable in the future B) a firm that is considered to be undervalued C) a firm expected to earn little profit in the future D) none of the above
Which of the following types of firms should expect a higher rate of return?
a. an auto dealership b. a biotech pharmaceutical firm c. a manufacturer of screws and bolts d. a paper products firm e. all of the above
According to the monetarists, which of the following is true?
a. Instability in the money supply is the primary cause of economic instability. b. A reduction in the money supply will cause consumers to increase spending. c. A reduction in the money supply will cause a proportional reduction in wages and prices, leaving output unchanged. d. A rapid growth rate of the money supply will lead to a rapid growth rate of real GDP.