As the number of available substitutes increases, the price elasticity of demand for a good:
A) initially increases then decreases.
B) initially decreases then increases.
C) decreases.
D) increases.
D
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Suppose the demand curve for hybrid cars shifts to the right. This will cause a relatively small increase in the price of hybrid cars if
A) both demand and supply are inelastic. B) demand is elastic and supply is inelastic. C) demand is inelastic and supply is elastic. D) both demand and supply are elastic.
Keynes believed that unstable investment caused the Great Depression. Using the simple Keynesian model, explain how a fall in investment affects equilibrium output
What will be an ideal response?
The services of real estate brokers are provided in a competitive market. If the state Board of Realtors enacts several requirements that limit the number of real estate brokers, then consumer surplus will most likely
A) increase. B) decrease. C) remain unchanged. D) There is not enough information to answer.
The school of economic thought that emphasized the importance of incentives to encourage savings, investment, and productivity is known as ________ economics.
Fill in the blank(s) with the appropriate word(s).