Suppose you have surveyed a few industries and obtained information about the income elasticity of demand for their products
If you expect that the economy is headed for a long recession, you would advise people to look for jobs in an industry with
A) a "low" negative income elasticity coefficient such as -0.2.
B) a high positive income elasticity coefficient such as 5.
C) a low positive income elasticity coefficient such as 0.8.
D) a "high" negative income elasticity coefficient such as -4.
D
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What are some of the problems that exist with a laissez-faire economy?
What will be an ideal response?
If there is an increase in demand for a good, what will most likely happen to the price and quantity of the good exchanged?
What will be an ideal response?
What happens to quantity demanded when price is lowered?
A. It rises B. It falls C. It stays the same D. It cannot be determined if it rises, falls, or stays the same
If a firm perceived that the other firm in an implicit pricing agreement dropped its price in an attempt to gain market share, then its most likely response would be to:
A. merge with the other firm. B. engage in a price war. C. raise price to punish the other firm. D. keep its price the same.