Suppose that utility-maximizing consumers in San Francisco pay three times as much for apples as for peaches. What is the ratio of the marginal utility of apples to the marginal utility of peaches?
A. 1/3
B. 3
C. 2/3
D. none of the above
E. cannot determine without further information
Answer: B
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The aggregate demand curve gives the
A) planned purchase rates for all goods and services in the economy at various price levels. B) demand for goods and services by the government at various price levels. C) amount of all goods everyone wants to buy at various income levels. D) planned purchases for all goods and services in the economy, holding other things such as the price level constant.
Explain the Fed's three tools of monetary policy and how each is used to change the money supply. Does each tool affect the monetary base or the money multiplier?
What will be an ideal response?
A value of the absolute price elasticity of demand equal to 0.25 indicates that
A) a 5% decrease in price leads to a 2% increase in quantity demanded. B) a 2% decrease in price leads to a 25% increase in quantity demanded. C) a 1% decrease in price leads to a 2.5% increase in quantity demanded. D) a 0.25% decrease in price leads to a 1% increase in quantity.
Suppose the total population of an economy is 150 million, the labor force is 100 million, and the unemployment is 94 million. The unemployment rate is _____
a. 6 percent b. 80 percent c. 94 percent d. 10 percent e. 15 percent