The most important determinant of the elasticity of supply is
A) whether the good is a durable good or a nondurable good.
B) the price of the good.
C) the time period firms have to adjust to the new price.
D) the proportion of the good in the budget of consumers.
Answer: C
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Banks lost trillions of dollars when the housing bubble collapsed because:
A. many borrowers defaulted on their mortgages. B. many large banks held massive quantities of mortgage-backed securities. C. most of their customers had to close their accounts due to foreclosures. D. Both A and B are correct.
Lincoln Electric paid employees on the basis of
A) deferred compensation. B) backloaded wages. C) a piece rate. D) forward loaded wages.
The economic problem of scarcity
a. is unique to a capitalist economy. b. requires that choices be made among alternatives. c. disappears as technology advances. d. affects only less-developed countries.
One fundamental idea in macroeconomics about inflation is:
A. when all prices rise, inflation occurs and everyone is worse off. B. if all prices decline, the purchasing power of everyone declines. C. if all wages rise, then inflation doesn't really affect anyone's purchasing power. D. keeping prices constant is the only way to ensure increasing purchasing power over time.