Price elasticity of demand is defined as
a. the percentage change in price divided by the percentage change in quantity demanded
b. the percentage change in quantity demanded divided by the percentage change in price
c. the change in quantity demanded divided by the change in price
d. the change in price divided by the change in quantity demanded
e. the quantity demanded divided by the price
B
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When a nation is producing on its production possibilities frontier, if more resources are used to produce one good, then the production of other goods
A) must increase. B) must decrease. C) must remain the same. D) must change but they might increase or decrease. E) might increase if the nation can produce more efficiently.
How will an increase in the government budget surplus as a result of lower government spending (with no change in net taxes) affect private saving in the economy?
A) Private saving will increase by the amount of increase in the budget surplus. B) Private saving will be unaffected by the increase in the budget surplus. C) Private saving will decrease by less than the amount of increase in the budget surplus. D) Private saving will decrease by the amount of increase in the budget surplus.
If real GDP grows by 3% in 2014, 3.2% in 2015, and 2.5% in 2016, what is the average annual growth rate of real GDP?
A) 2.6% B) 2.9% C) 3.1% D) 4.2%
Using the simple Keynesian model with a consumption function of C = 200 + .9Y, an $10 change in desired investment leads to a change in equilibrium income of
A) $10. B) $100. C) $20. D) $90.