If a 15% increase in price for a good results in a 20% decrease in quantity demanded, the price elasticity of demand is
a. 0.75.
b. 1.25.
c. 1.33.
d. 1.60.
c
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At a level of real disposable income of $1,000, suppose consumption is $2,000. Given this information, we know with certainty that saving equals
A) $2,000. B) $0. C) -$1,000. D) -$2,000.
The legislation passed in 1946 that requires governmental institutions to promote "maximum employment, production, and purchasing power" is called:
A) Full Employment and Balanced Growth Act. B) Federal Reserve Act. C) Employment Act. D) Unemployment Act.
If the MPC equals 0.80 then:
a. the MPS equals 1.20. b. the multiplier equals 0.20. c. the multiplier equals 1 divided by 0.80. d. the multiplier equals 5. e. none of these.
Two goods are considered substitutes when the cross elasticity of demand is ___ and complements when the cross elasticity of demand is ___
a. Greater than zero, less than zero. b. Less than zero, greater than zero. c. Greater than one, less than one. d. Less than one, greater than one.