Use the following graph to answer the question below.
Using the regular percentage change formula, what is the price elasticity of supply when moving from point A to point B?
A. 2
B. 1
C. 3
D. 1/3
Answer: B
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The quantity theory of money implies that over the long run, the inflation rate will ________
A) equal the nominal interest rate B) equal the growth rate of M2 minus the growth rate of real output C) equal the growth rate of M2 plus the growth rate of real output D) equal the velocity of money
Given that the firm wants to sell both the versions, how high can the high-end professional knives be priced?
a. $60 b. $70 c. $80 d. $100
For policymakers, the problem with a recessionary gap is ________ and the problem with an expansionary gap is ________.
A. a tendency for inflation to increase; wasted resources B. an increase in cyclical unemployment; an increase in structural unemployment C. wasted resources; a tendency for inflation to increase D. an increase in structural unemployment; an increase in cyclical unemployment
High gasoline prices give people all of the following incentives EXCEPT
A. to drive less. B. to car pool. C. to take vacations that require driving more miles. D. to buy a hybrid car.