For which of the following types of goods would the income elasticity of demand be positive and relatively large?
a. all inferior goods
b. all normal goods
c. goods for which there are many complements
d. luxuries
d
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A policy maker who is concerned that the unemployment rate is too high would ________.
A. use tariffs to reduce imports and increase net exports B. increase the minimum wage C. decrease government spending D. increase taxes
If the fractional reserve system did not exist,
a. the banking system could not create money b. the money multiplier would be infinite c. banks would loan out every penny of their deposits d. banks would be highly susceptible to bank runs e. the banking system would realize maximum profit
The Index of Economic Freedom measures the market concentration in an economy
a. True b. False Indicate whether the statement is true or false
If at a given real interest rate desired national saving is $60 billion, domestic investment is $30 billion, and net capital outflow is $20 billion, then at that real interest rate in the loanable funds market there is a
a. surplus. The real interest rate will rise. b. surplus. The real interest rate will fall. c. shortage. The real interest rate will rise. d. shortage. The real interest rate will fall.