What is the common feature displayed by the following items?
a. eating in a newly opened "fusion" cuisine restaurant
b. attending a Red Sox game in Fenway Park
c. wearing Lucky Brand designer jeans
A) They are all highly inelastic goods.
B) The consumption of these goods takes place publicly.
C) They tend to be consumed by better educated people.
D) The consumption of these goods takes place privately.
B
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Refer to Figure 2-1. Point C is
A) technically efficient. B) unattainable with current resources. C) inefficient in that not all resources are being used. D) is the equilibrium output combination.
The quantity theory of money was derived from the quantity equation by asserting that
A) real output was fixed. B) the money supply was fixed. C) the velocity of money was zero. D) the velocity of money was fixed.
In an open economy, the government purchases multiplier will be smaller the
A) larger the marginal propensity to consume. B) smaller the marginal propensity to import. C) larger the tax rate. D) All of the above are correct.
When quantity supplied is NOT very responsive to a change in price, supply is
A) elastic. B) unit-elastic. C) inelastic. D) income sensitive.