The price elastic portion of the linear demand curve lies
a. b and c
b. above the point of unit elasticity
c. anywhere to the left of current market prices
d. below the point where total revenue is maximized
e. at the intersection with the supply curve
B
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Goodland is currently operating at full capacity. The country experienced a sudden boom in economic activity. However, the unemployment rate increased soon afterwards. What is likely to have caused such a phenomenon?
What will be an ideal response?
An inflationary gap is created when
A) real GDP is greater than potential GDP. B) real GDP equal to potential GDP. C) the inflation rate is less than potential inflation. D) the price level exceeds the equilibrium price level. E) potential GDP is greater than real GDP.
Ayanna grows herbs. Last year she grew 2,000 pounds of herbs in a year while using 250 square feet of land and 1 worker. This year she doubled her land to 500 square feet, doubled her workers to 2, and grew 4,500 pounds of herbs
She sells her rare, organic herbs for $50 a pound. She pays her workers $25,000 a year and rents her land for $100 per square foot for a year. These are her only costs. a) What was Ayanna's total cost last year and this year? b) What was Ayanna's average total cost last year and this year? c) Did Ayanna experience economies or diseconomies of scale?
Which of the following correctly defines the average propensity to consume (APC)?
A) change in planned consumption divided by change in real disposable income B) planned consumption divided by real disposable income C) real disposable income divided by planned consumption D) change in real disposable income divided by change in planned consumption