A steel mill raises the price of steel by 20%, which results in a 7% reduction in the quantity of steel demanded. The demand curve facing this firm is:
a. elastic
b. inelastic.
c. unit elastic.
d. unit inelastic.
b
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Which statement most accurately describes the effect financial technology has had on the demand for money in the United States?
A) Advances in financial technology have all increased the demand for money. B) Some advances in financial technology have increased the demand for money while others have decreased it. C) It is not possible to tell what would be the effect because financial technology has not changed over the past three decades. D) Advances in financial technology have all decreased the demand for money. E) Advances in financial technology have had no effect on the demand for money.
Use Tobin's q theory and the neoclassical theory of investment to explain why investment rises so rapidly once the economy has passed the trough of a business cycle
What will be an ideal response?
The price elasticity of demand of science fiction novels is 2.3. Demand is
a. inelastic. b. unit elastic. c. elastic. d. elasticity.
Economic models
a. are people who act out the behavior of firms and households so that economists can study this behavior. b. are usually detailed replications of reality. c. incorporate simplifying assumptions that often contradict reality, but also help economists better understand reality. d. are useful to researchers but not to teachers because economic models omit many details of the real-world economy.