Which of the following examples would likely have the lowest elasticity of demand if the price of the product changed?
a. Ramon spends $5 of his weekly paycheck of $1,500 on yogurt.
b. Cynthia spends $200 of her weekly paycheck of $1,000 on clothes.
c. Karl spends $50 of his weekly paycheck of $1,200 on music streaming.
d. Yuna spends $800 of her weekly paycheck of $2,000 on a HD television.
a. Ramon spends $5 of his weekly paycheck of $1,500 on yogurt.
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Compared to a barter economy, an economy that uses money will
A) be greedier. B) be poorer. C) have more corruption. D) have more output.
Using the above figure, if the government levies a new unit tax in this market, S represents the original supply curve, and St represents the after-tax supply curve, then the revenues that the government collects from imposing this tax is represented on this graph by
A. BAEC. B. OAEG. C. CEF. D. OBCG.
The inflation associated with the oil price shocks in the 1970s after OPEC restricted the supply of oil is an example of
A. cost-push inflation due to a demand shock. B. cost-push inflation due to a supply shock. C. demand-pull inflation due to a supply shock. D. demand-pull inflation due to a demand shock.
If a firm shuts down in the short run
A. it will lose its operating costs. B. it will incur only its explicit costs. C. its losses will be equal to zero. D. it will incur its fixed costs.