If bus travel is an inferior good, then its income elasticity of demand will be
a. strictly greater than one.
b. positive.
c. equal to zero.
d. negative.
D
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Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each. Process(smoke/day) A(4 tons/day) B(3 tons/day) C(2 tons/day) D(1 ton/day) E(0 tons/day) Cost to Firm X ($/day) $500$514$530$555$585 Cost to Firm Y ($/day) $400$420$445$480 $520Cost to Firm z ($/day) $300$325$360$400 $550For all three firms, the marginal cost of pollution abatement is:
A. increasing B. decreasing C. decreasing and then increasing D. constant
It is possible that when the money supply rises, interest rates may ________ if the ________ effect is more than offset by changes in income, the price level, and expected inflation
A) fall; liquidity B) fall; risk C) rise; liquidity D) rise; risk
Refer to the figure below, expenditures as a percent of GDP fell dramatically in the 1980s.
A. True
B. False
C. Uncertain
The demand curve for a monopolistic competitor slopes downward because: a. quantity demanded drops to zero after a slight price increase
b. there are close, but not perfect, substitutes for the product. c. customers have no loyalty to the product. d. the product is not differentiated in any way from those offered by other sellers.