Blake decreases his consumption of grapes after his income goes up. For Blake
A. grapes and income are complementary goods.
B. grapes are an inferior good.
C. grapes and income are substitute goods.
D. grapes are a superior good.
Answer: B
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If oil refiners expect the government to tax away any profits created by international supply disruptions, refiners will choose to
A) carry smaller inventories of crude petroleum. B) leave the oil refining business. C) prevent the price of crude petroleum from rising. D) raise their prices to cover their added risks. E) take a higher percentage of their profits as windfalls.
Fitness is a magazine for women about health and exercise. Fitness offers year subscriptions for $12 on their website. Jess, Ania, Mandy, and Chloe exercise together and each enjoy reading Fitness
Jess is willing to pay $10, Ania is willing to pay $16, Mandy is willing to pay $24, and Chloe is willing to pay $12 for a subscription to the magazine. Who will subscribe to the magazine? A) Ania, Mandy, and Chloe B) Jess, Ania, Mandy, and Chloe C) Jess, Ania, and Chloe D) Mandy and Chloe
An asset is liquid if
A) it earns interest. B) it is backed by a government guarantee. C) it can be exchanged for other items of value without high transaction costs. D) All of the above are correct.
The supply of paintings by Van Gogh is most likely to be
a. of infinite elasticity because supply is limited b. of high elasticity because supply is limited c. elastic because the paintings are luxury goods d. inelastic because supply is limited e. unit elastic