Refer to the information provided in Figure 5.4 below to answer the question(s) that follow.
Figure 5.4Refer to Figure 5.4. Along the given demand curve, which of the following is true?
A. Since the demand curve is linear, the price elasticity of demand between each of the points is the same.
B. Demand is less elastic along the segment EF than the segment AB.
C. Demand is less elastic along the segment AB than the segment EF.
D. All of the above are true.
Answer: B
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Suppose the annual rate of interest is r%. Which of the following statements is then true of the future value of $1,000 for a time of T years?
A) Irrespective of whether the sum of $1,000 is borrowed or lent, the future value in both cases will equal (1 - r)T × (1,000). B) Irrespective of whether the sum of $1,000 is borrowed or lent, the future value in both cases will equal (1 + r)T × (1,000). C) If $1,000 is borrowed, the future value will equal (1 + r)T × (1,000), but if it is lent out, the future value will equal (1 - r)T × $1,000. D) If $1,000 is borrowed, the future value will equal (1 - r)T × (1,000), but if it is lent out, the future value will equal (1+ r)T × $1,000.
Pork can be used to produce bacon or sausage, but not both. If the price of bacon rises for some reason, then, everything else equal,
a. the price of sausage will rise. b. the price of sausage will fall. c. the resources used in raising Pork will become more expensive. d. the resources used in raising Pork will become less expensive.
The long-run aggregate supply curve shifts left if
a. the capital stock increases. b. there is a natural disaster. c. the government removes some environmental regulations that limit production methods. d. None of the above is correct.
A measure of the responsiveness of demand to changes in income, all other things being constant, is
A) income elasticity of demand. B) price income elasticity of demand. C) price elasticity of demand. D) cross price elasticity of demand.