According to this Application, the volatility of energy prices can contribute to uncertainty in the economy. An increasingly uncertain future will tend to cause firms to
A) delay their investment decisions.
B) continue with a stable flow of investment spending so as not to get trapped by a downturning economy.
C) wait for significant GDP growth before reducing investments.
D) rely on the government to make their investment decisions for them.
A
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Compared to a monopolistic competitor, a monopolist faces
A) a more elastic demand curve. B) a more inelastic demand curve. C) a demand curve that has a price elasticity coefficient of zero. D) a more elastic demand curve at higher prices and a more inelastic demand curve at lower prices.
Borrowers rely on financial intermediaries to hold and find uses for their funds that promise a positive expected rate of return
Indicate whether the statement is true or false
If the price of a good increases by 10 percent, its quantity demanded drops by 50 percent. The price elasticity of demand is:
A. 1.0 B. 0.2 C. 5.0 D. 2.0
If the relative price of a concert ticket is three times the price of a meal at a good restaurant, then the opportunity cost of a concert ticket can be measured by the
a. slope of the budget constraint. b. slope of an indifference curve. c. marginal rate of substitution. d. income effect.