The price elasticity of demand for eggs is -.27 and the price elasticity of demand for soft drinks is -.70. Therefore, the demand for eggs
A. cannot be compared to the demand for soft drinks because eggs cannot be substituted for soft drinks.
B. is more elastic.
C. cannot be compared to the demand for soft drinks because both are negative.
D. is less elastic.
Answer: D
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Everything else held constant, if the tax-exempt status of municipal bonds were eliminated, then
A) the interest rates on municipal bonds would still be less than the interest rate on Treasury bonds. B) the interest rate on municipal bonds would equal the rate on Treasury bonds. C) the interest rate on municipal bonds would exceed the rate on Treasury bonds. D) the interest rates on municipal, Treasury, and corporate bonds would all increase.
Refer to Scenario 12.3. What will be the price of this new drink in the long run if the firms in the industry collude with one another to maximize joint profit?
A) $3 B) $9 C) $12 D) $16.50 E) none of the above
For the measure of fit in your regression model with a binary dependent variable, you can meaningfully use the
A) pseudo R2. B) size of the regression coefficients. C) standard error of the regression. D) regression R2.
If demand is inelastic and the price of a product decreases by 10 percent, then
A) the change in quantity demanded is less than 10 percent. B) the change in quantity demanded is equal to 10 percent. C) the change in quantity demanded is greater than 10 percent. D) the decrease in quantity demanded is greater than 0 percent.