If the price of a good shown on the vertical axis of a budget graph is cut in half and the price of the good on the horizontal axis is cut by 75%, then the budget constraint shifts
A. right and becomes steeper.
B. left and becomes steeper.
C. right and becomes flatter.
D. left and becomes flatter.
Answer: B
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When voluntary exchange takes place, neither party usually gains from the exchange
Indicate whether the statement is true or false
Average revenue for a perfectly competitive firm is equal to
a. price times output b. marginal revenue c. total revenue/marginal revenue d. output/total revenue e. zero
Which of the following is true about inflation? a. Inflation promotes social harmony by uniting people against the government
b. Inflation is more damaging if it is unanticipated. c. Accurate anticipation of inflation is possible for everyone who is well informed about economic events. d. Those who lend money at a rate above the rate of inflation suffer economic losses. e. If people accurately anticipate inflation, their actions will prevent it.
Which of the following is not a property of ideal of money?
a. Durable b. Portable c. Divisible d. Diversified quality