The demand curve for a Giffen good slopes upward
Indicate whether the statement is true or false
TRUE
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If the price elasticity of demand is computed for two products, and product A measures 0.65, and product B measures 1.3, then
a. product A is more price elastic than product B. b. product B is more price elastic than product A. c. consumers are more sensitive to price changes in product A than in product B. d. product B is more price inelastic than product A. e. products A and B must be substitutes.
A perceived permanent rise in the rate of money growth will cause what long-run effects in the economy?
a. a rise in the nominal rate of interest and a rise in inflation by the same percentage b. a rise in the nominal rate of interest and a rise in real GDP by the same percentage c. a fall in the nominal rate of interest and a rise in inflation by the same percentage d. a fall in the nominal rate of interest and a fall in real GDP by the same percentage
Figure 4-11 Refer to. On the Laffer curve shown, which of the following is true?
a. Tax revenue would increase if marginal tax rates were lowered from point C.
b. Tax revenue would decrease if marginal tax rates were lowered from point A.
c. Tax revenues are maximized at a tax rate corresponding to point B.
d. All of the above are true.
Double counting in the national income accounts will occur if GDP is computed by summing up:
A. all sales. B. final output sales. C. the income earned by a country's residents. D. value added.