The income elasticity of demand for bicycles is +10, which implies that bicycles are
A) an inferior good.
B) a normal good.
C) a substitute good for motorbikes.
D) a complement good for motorbikes.
B
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The money-creation multiplier is the
A) same as the income-determination multiplier. B) amount by which the money supply would rise with a $1 increase in the supply of high-powered money. C) amount by which the money supply of high-powered money will increase equilibrium GDP. D) amount by which a $1 increase in reserves would raise an individual bank's deposit liabilities.
Expansionary fiscal policy
A) raises Real GDP more in an open economy than in a closed economy. B) raises Real GDP more in a closed economy than in an open economy. C) raises Real GDP equally in an open economy and in a closed economy. D) does not affect Real GD"P in an open economy.
You purchased a December corn futures contract on July 1. A month later you decide you would like to take delivery. You do which of the following?
A. You can call up your broker and get almost immediate delivery. B. You will get delivery only if by chance the buyer you bought from decides to deliver. C. You must wait until December 1 and then you can demand delivery. D. None of the above.
When price and marginal cost are equal for a perfectly competitive firm, the firm is
A. maximizing economic profit. B. earning negative economic profit. C. maximizing total revenue. D. minimizing average total cost.