The elasticity which shows the responsiveness of the demand for a good due to changes in the price of a related good is the:
A. income elasticity.
B. log-linear elasticity.
C. own price elasticity.
D. cross-price elasticity.
Answer: D
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If the Fed wishes to reduce nominal interest rates, it must engage in an open market ________ of bonds to ________ the money supply.
A. sale; decrease B. purchase; decrease C. sale; increase D. purchase; increase
Suppose that along the aggregate demand curve, real GDP equals $14.2 trillion when the GDP deflator is 90. If the GDP deflator were 95, real GDP along the aggregate demand curve would equal
A) more than $14.2 trillion but less than $14.8 trillion. B) less than $14.2 trillion. C) $14.2 trillion. D) more than $14.8 trillion.
Which of the following would NOT shift the aggregate demand curve to the left?
A) an increase in money demand B) a cut in federal government spending C) a reduction in federal income taxes D) a decrease in consumption spending
A monopolist changes price from $1 to $2 and sells 10 fewer units. The marginal revenue is
A) $10 B) -$10 C) $0 D) impossible to determine with the information provided.