While in college, Marty and Laura each buy 15 bus tickets per month. After they graduate and have full-time jobs, Marty buys 0 bus tickets per month and Laura buys 28 bus tickets per month. Comparing income elasticity of demand for bus tickets, Marty's
a. is negative, and Laura's is positive.
b. is positive, and Laura's is negative.
c. is zero, and Laura's is positive.
d. is zero, and Laura's is negative.
a
You might also like to view...
Alison is deciding how to spend the next hour. We ask her to rate the utility she would get from an hour of each activity. She would get utility of 4 from an hour of reading, utility of 2 from an hour of playing video games, and utility of 6 from jogging. Based on this information, economists could predict that Alison will:
A. read. B. play video games. C. go jogging. D. do nothing, since none of the activities give her utility greater than 10.
Elasticity
a. deals with percentage changes in price and quantity demanded. b. employs percentage changes calculated in terms of average values of the prices and quantities at issue. c. is generally stated in absolute value. d. All of the above are correct.
Table 10.1Refer to Table 10.1, which shows the relationship between the price that Gladys charges for a product and the quantity of that product that Gladys sells. Gladys' marginal revenue becomes negative starting with the production of which unit?
A. 2 B. 4 C. 6 D. None of these; marginal revenue is always positive or zero.
An inward shift of a nation's production possibilities frontier can occur due to
A) a reduction in unemployment. B) a natural disaster like a hurricane or bad earthquake. C) a change in the amounts of one good desired. D) an increase in the labor force.