One basic assumption of the aggregate expenditures model is that:
A. The economy is operating at full employment
B. There is inflation in the economy
C. There is no public sector in the economy
D. The average price level in the economy is fixed
D. The average price level in the economy is fixed
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The following is not an appropriate way to tell whether two variables are cointegrated:
A) see if the two variables are integrated of the same order. B) graph the series and see whether they appear to have a common stochastic trend. C) perform statistical tests for cointegration. D) use expert knowledge and economic theory.
Suppose your own demand curve for tomatoes slopes downward. Suppose also that, for the last tomato you bought this week, you paid a price exactly equal to your willingness to pay. Then
a. you should buy more tomatoes before the end of the week. b. you already have bought too many tomatoes this week. c. your consumer surplus on the last tomato you bought is zero. d. your consumer surplus on all of the tomatoes you have bought this week is zero.
If 50 units are sold at a price of $20 and 80 units are sold at a price of $15, what is the absolute value of the price elasticity of demand? Use the midpoint formula
A) 0.17 B) 0.62 C) 1.62 D) 5
Commodities that last less than three years and may be consumed very quickly are called:
A) durable goods B) nondurable goods C) services D) none of the above