Price elasticity of demand is generally:
A. greater in the long run than in the short run.
B. greater in the short run than in the long run.
C. the same in both the short run and the long run.
D. greater for "necessities" than it is for "luxuries."
Answer: A
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Which of the following monthly data series is closely observed by the Business Cycle Dating Committee of the NBER?
a. Real personal income less transfer payments b. Wholesale prices of goods c. Real GDP d. Total unemployment e. Real interest rates
Which of the following is a drawback of government investment in R&D?
a. Close government scrutiny of R&D projects b. Lack of tax reductions for R&D expenses c. Unclear assignment of patent rights d. Additional costs of government free riders
At a price of $1.00, a local coffee shop is willing to supply 100 cinnamon rolls per day. At a price of $1.20, the coffee shop would be willing to supply 150 cinnamon rolls per day. Using the midpoint method, the price elasticity of supply is about
a. 0.45 b. 0.90 c. 1.11 d. 2.20
Figure 4-7
Refer to . The supply curve S1 and the demand curve D indicate initial conditions in the market for gasoline. A $.60-per-gallon excise tax on gasoline is levied, which shifts the supply curve from S1 to S2. Imposing the tax causes the equilibrium price of gasoline to increase from
a.
$.80 to $1.40.
b.
$.80 to $1.50.
c.
$.90 to $1.50.
d.
$.90 to $1.40.