Lower nominal interest rates ________ the amount of money demanded and a lower price level ________ the amount of money demanded.
A. increase; decreases
B. decrease; decreases
C. increase; increases
D. increase; does not change
Answer: A
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If the elasticity of demand for the latest American Idol album is 1.4, this means
A. few substitutes for the American Idol album exist. B. a 10% decrease in the price leads to a 140% increase in quantity demanded. C. a 5% increase in the price leads to a 7% decrease in quantity demanded. D. a 1% increase in the price leads to a 14% decrease in quantity demanded.
Goods that can be produced at a constant or very gently rising opportunity cost have
A) an elastic demand. B) an inelastic demand. C) an inelastic supply. D) an elastic supply. E) a unit elastic demand.
In the short run, a decrease in the market demand will cause a(n) ________ in the market equilibrium price and a perfectly competitive firm's demand and marginal revenue curve to shift ________.
A) increase; upward B) decrease; upward C) increase; downward D) decrease; downward
What's the firm's contribution margin?
a. $15 b. $18 c. $3 d. $4