The quantity theory of money assumes that
a. velocity varies inversely with interest rates.
b. if velocity equals six, the Fed can increase nominal GDP by 30 percent if it increases the money supply by 5 percent.
c. changes in the money supply affect output but not prices.
d. changes in velocity are so small that velocity can be considered constant.
d
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Advertising costs
A) make the marginal revenue more elastic. B) shift the ATC curve upward. C) shift the marginal cost curve rightward. D) indirectly shift the marginal cost curve upward. E) affect the marginal cost but not the total cost.
An HVAC company is selling heating and cooling equipment. It has separate sales and marketing units. The marketing unit would want to
a. Price aggressively to ensure sales are made b. Price less aggressively to ensure that profitable sales are made c. Price at cost to maximize sales d. None of the above
Suppose that a local supermarket sells apples and oranges for 50 cents apiece, and at these prices is able to sell 100 apples and 200 oranges per week. One week, the supermarket lowered the price per apple to 40 cents and sold 120 apples. The next week, they lowered the price per orange to 40 cents (after raising the price per apple back to 50 cents) and sold 240 oranges. These results imply that
the a. price elasticity of apples is lower than the price elasticity of oranges b. price elasticity of apples is higher than the price elasticity of oranges c. demand for apples is more price sensitive than the demand for oranges d. demand for oranges is more price sensitive than the demand for apples e. price elasticities of demand for apples and oranges are the same over these price ranges
When the price of a good is legally set below the equilibrium level, a shortage often results. This shortage
a. is a temporary failure of the market mechanism. b. is the result of a shift in demand. c. is the result of a shift in supply. d. occurs because the price ceiling prevents the market mechanism from establishing an equilibrium price.