If the price of coffee increases from $2.50 per cup to $3.00 per cup and the quantity demanded goes down from 120 cups per week to 115 cups per week, the absolute value of price elasticity of demand in that price range is approximately
A. 2.34.
B. 0.23.
C. 4.35.
D. 0.93.
Answer: B
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If both money demand and commodity demand are unstable, as many activists believe, which type of policy target(s) would most likely lead to a stable economy (assuming supply-side shocks are likely to occur)?
A) money supply target B) real GDP target C) interest rate target D) nominal GDP
In economics, the term marginal refers to:
a. the change or difference from a current situation. b. man-made resources as opposed to natural resources. c. the satisfaction a consumer receives from a good. d. holding everything else constant in the analysis.
The sum of national saving and capital inflows from abroad must equal:
A. capital outflows. B. aggregate demand. C. the trade deficit. D. domestic investment in new capital goods.
Answer the following statement(s) true (T) or false (F)
1. Microeconomics is the study of the whole economy, including topics of inflation and economic growth. 2. Causation occurs when two events occur together. 3. The fallacy of composition states that even if something is true for an individual, it is not necessarily true for many individuals combined in a group. 4. In the role of scientist, the economist is concerned about the ethics of human behavior.