If an item has an absolute price elasticity of demand that is greater than 1, we say the demand for the item is
A) elastic.
B) inelastic.
C) perfectly inelastic.
D) unit elastic.
A
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According to many economists, production that occurs in the underground economy
a. has no market value and therefore should not be included in GDP b. is given too much weight by the Bureau of Economic Analysis, causing GDP to overstate true output c. consists exclusively of illegal production activities such as drug selling and prostitution d. is accurately accounted for by the Bureau of Economic Analysis in its measurement of GDP e. is given insufficient weight by the Bureau of Economic Analysis, causing GDP statistics to understate true output
Suppose Laqueta deposits $10,000 of cash into a checking account at a commercial bank. The immediate effect is
a. a $10,000 decrease in the M1 money supply. b. no change in the M1 money supply, but in the future, the M1 money supply will tend to decrease because the bank now has excess reserves. c. no change in the M1 money supply, but in the future, the M1 money supply will tend to expand because the bank now has excess reserves. d. a $10,000 increase in the M1 money supply.
Describe what the unemployment rate and the employment rate measure. If we were to sum the unemployment rate and the employment rate, would that sum be equal to one hundred percent? Explain why or why not
In Figure 2.1, Box 3 would be labeled
A. S for supply. B. D for demand. C. P for price. D. P* for equilibrium price.