Necessities Versus Luxuries
What will be an ideal response?
Whether a person considers a good to be a necessity or a luxury has a great impact on a person's elasticity of demand for that good.
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
If the cross-price elasticity of demand for computers and software is negative, this means the two goods are
A) normal. B) inferior. C) substitutes. D) complements.
About one out of every ________ white children under the age of 18 is poor.
Fill in the blank(s) with the appropriate word(s).
Which of the following are examples of situations with negative network externalities?
A. All of the above B. A crowded beach C. Clothing made to order D. A rare work of art