If a decrease in the price of good X results in a decrease in the quantity of Y demanded,
A. good X and good Y are substitutes.
B. good X and good Y are complements.
C. the cross-price elasticity of demand for good Y is negative.
D. There is not sufficient information to determine the relationship between good X and good Y.
Answer: A
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Suppose that the expected inflation rate is 3 percent and the actual inflation rate is 6 percent. Then borrowers
A. are worse off and lenders are better off. B. and lenders are both worse off. C. are better off and lenders are worse off. D. and lenders are both better off.
Figure 34-6
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From Figure 34-6, one can infer that
A. Honduras will be willing to trade bananas for corn at a unit ratio of no less than 2 corn:1 banana. B. Honduras will be willing to trade bananas as long as the unit exchange ratio is greater than 1/2 corn:1 banana. C. Honduras has no potential to gain from trade. D. Honduras will be unwilling to trade at an exchange ratio.
In a market, buyers want to pay the ________ possible price and sellers want to charge the ________ possible price.
A. highest, highest B. highest, lowest C. lowest, lowest D. lowest, highest
Income is a flow measure.
Answer the following statement true (T) or false (F)