An increase in the population of an economy can shift the demand curves for certain goods and services to the right
a. True
b. False
Indicate whether the statement is true or false
True
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The price elasticity of demand for furniture is estimated at 1.3. This value means a one percent increase in the
A) price of furniture will increase the quantity of furniture demanded by 1.3 percent. B) price of furniture will decrease the quantity of furniture demanded by 1.3 percent. C) quantity of furniture demanded will decrease the price of furniture by 1.3 percent. D) quantity of furniture demanded will increase the price of furniture by 1.3 percent.
If the market demand for paper remains the same as in Problem 6, calculate the market price, market output, and the economic profit or loss of each firm
What will be an ideal response?
The equilibrium output level in the country of Plutonia is $44 billion, while its potential output is $74 billion. Suppose the central bank of the country implements an expansionary monetary policy. Which of the following is likely to occur?
a. An increase in interest rates will stimulate investment, shifting the aggregate demand curve to the right. b. A reduction in interest rates will stimulate investment, shifting the aggregate demand curve to the right. c. A reduction in interest rates will lower investment, shifting the aggregate demand curve to the left. d. An increase in interest rates will lower investment, shifting the aggregate demand curve to the left.
The accompanying figure shows the annual production possibilities curve for a small country that is open to trade with the rest of the world. Suppose the world price of cashews is $12 per pound, and the world price of mangos is $4 per pound. As indicated in the figure, at these prices, this country will produce 21,000 pounds of mangos and 5,000 pounds of cashews each year.
At this country's current level of production, what is the opportunity cost of a pound of mangos in terms of cashews?
A. 21/5 pounds of cashews B. 3 pounds of cashews C. 1/3 pounds of cashews D. 5/21 pounds of cashews