A perfectly inelastic demand curve has an elasticity coefficient of:
A. 0.
B. 1.
C. less than 1.
D. infinity.
Answer: A
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Refer to Table 7-6. If the actual terms of trade are 1 belt for 1.5 swords and 50 belts are traded, how many belts will Morocco consume?
A) 60 B) 70 C) 90 D) 120
Do government bureaucracies misallocate resources? If so, how and why? Can you list one possible way to limit the negative effects of special interests such as bureaucracies?
What will be an ideal response?
The Phillips curve:
a. was relatively well-defined during the 1960s. b. demonstrates how to achieve stable economic growth. c. shows the trade-off between deficits and inflation. d. helps to stimulate entrepreneurial profits. e. becomes vertical at full employment.
Economic models do not have to completely describe every aspect of the economy in order to be useful
a. True b. False