Refer to the information provided in Figure 6.2 below to answer the question(s) that follow.
Figure 6.2Refer to Figure 6.2. Along budget constraint AC, the opportunity cost of one beer is
A. 1/4 of a gardenburger.
B. 1 gardenburger.
C. 2 gardenburgers.
D. changing as Mr. Lingle moves down his budget constraint.
Answer: B
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In the Keynesian cross diagram, an increase in autonomous consumer expenditure causes the aggregate demand function to shift ________, the equilibrium level of aggregate output to rise, and the IS curve to shift to the ________,
everything else held constant. A) up; left B) up; right C) down; left D) down; right
A few economies have the interesting characteristic that exports are more than 100 percent of the economy's GDP. How is this possible?
What will be an ideal response?
If the absolute price elasticity of demand for a product is greater than 1, then
A) consumers are relatively insensitive to price changes. B) consumers are relatively sensitive to price changes. C) there is a positive relationship between price changes and total revenue. D) producers are relatively insensitive to price changes.
Suppose that high-definition television sets (HDTVs) are normal goods. Would the compensated demand curve for HDTVs be flatter or steeper than the uncompensated demand curve? Explain your answer using a carefully-labeled graph.
What will be an ideal response?