Relative percentage changes are used in measuring price elasticity of demand, so that
A) it does not matter whether price increases or decreases when calculating the elasticity.
B) it does not matter what units are used to measure prices or quantities.
C) we always obtain a positive number.
D) larger numbers indicate greater responsiveness.
Answer: B
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A) low; safer B) low; riskier C) high; safer D) high; riskier
The unfunded nature of the Social Security system has no effect on investment
a. True b. False
A firm in monopolistically competitive market is producing 30 units of output. At this level of production, the firm charges $50 per unit. Its marginal cost is $24 and marginal revenue is $24, and average cost is $20 per unit. Given this information, this firm should
A. maintain its current output, since it is maximizing profits. B. decrease output to increase profits. C. increase output to increase profits. D. shut down.
Why is it necessary for all economic systems to not only provide people with goods and services, but also restrict them from getting as much of these goods and services as they wish?
A) Failure to do this could reduce the efficiency of the system by producing some goods and services that are not as highly valued as others. B) Failure to do this could lead to an inequitable allocation of goods and services produced. C) Failure to do this will lead to drastic shortages of all goods and services. D) Failure to do this could reduce efficiency and lead to an inequitable allocation of output.