The following graph depicts demand. 
At point A, demand is:
A. unit elastic.
B. inelastic.
C. elastic.
D. perfectly elastic.
Answer: C
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A regulatory agency that requires a firm to provide “universal service” must
A. prevent high profits in all markets. B. allow the firm to cross-subsidize. C. prevent cross-subsidization. D. guarantee marginal cost pricing.
The total of all planned expenditures in the entire economy is the definition of
A. production possibilities curve. B. net domestic product. C. aggregate supply. D. aggregate demand.
The growing popularity of energy conservation has enticed large home improvement stores like Home Depot and Lowes to offer tankless water heaters. How does the fact that home improvement stores now offer these products affect the tankless water heater
market? A) The demand curve for tankless water heaters shifts to the right. B) The demand curve for tankless water heaters shifts to the left. C) The supply curve for tankless water heaters shifts to the right. D) The supply curve for tankless water heaters shifts to the left.
At the beginning of the year, one developing country (DVC) has a real income per capita of $800. In a developed country (IAC), the real income per capita is $30,000. Both countries experience a 4 percent growth rate for the year. At the end of the year, the absolute income gap between these two countries will have increased from $29,200 to:
A. $30,368 B. $31,200 C. $30,120 D. $32,032