If the absolute price elasticity of demand for automobiles is equal to 1.25, we say
A) that demand is elastic.
B) that demand is inelastic.
C) that there is a strong responsiveness of quantity demanded to automobiles price cuts.
D) none of the above is correct.
Answer: A
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If we compare regulating a natural monopoly using a marginal cost pricing rule to using an average cost pricing rule, we see that output is
A) greater with marginal cost pricing, but average cost pricing allows for costs to be covered. B) the same under both cases, but the profit is greater with average cost pricing. C) greater under average cost pricing, but profits are greater with marginal cost pricing. D) the same but profits are greater with marginal cost pricing. E) greater with marginal cost pricing, and the firm's profit is larger with marginal cost pricing.
According to the modern expectational Phillips curve illustrated inFigure 15-2 , unemployment will temporarily rise above the natural rate of unemployment when
a. inflation turns out to be lower than what people expected.
b. inflation turns out to be higher than what people expected.
c. inflation turns out to be equal to what people expected.
d. all of the above are true.a
Refer to the above data. The expenditures approach to GDP calculation can be done by adding:
1 through 7 8 through 13 2 through 7 8 through 11
Jeremy is thinking of starting up a small business selling NASCAR memorabilia. He is considering setting up his business as a sole proprietorship. What is one disadvantage to Jeremy of setting up his business as a sole proprietorship?
A) As a sole proprietor, Jeremy would be taxed twice. B) As a sole proprietor, Jeremy would not have control of the business. C) As a sole proprietor, Jeremy would face unlimited liability. D) As a sole proprietor, Jeremy would be subject to significant rules and regulations.