What are substitute goods, and how does a change in the price of one substitute good influence the demand for the other?
What will be an ideal response?
Substitute goods are goods that can be used in place of one another. If the price of one substitute good (good X) increases, then the demand of the other substitute good (good Y) increases, ceteris paribus.
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Which of the following is an example of a supply shock?
A) a surprise increase of the money supply B) an increase in the price level C) a sharp increase in the price of oil D) an increase in government spending
Present value is:
A. how much a certain amount of money that will be obtained in the future is worth today. B. how much a certain amount of money that you have in the present will be worth in the future. C. the process of accumulation of additional interest paid on interest that has already been earned. D. how much a certain amount of money needs to be discounted to be meaningful.
Economic conditions favor firms getting larger (producing larger quantity) when the firms are producing under conditions of:
a. Decreasing returns to scale b. Increasing returns to scale c. Constant returns to scale
If one euro is equal to 0. 60 U.S. dollars, what would be the euro price of a car that costs $10,000?
A. 10,000 euros. B. 60,000 euros. C. 5,000 euros. D. 16,667 euros.