If the price elasticity of demand for a good is 0.2, then a 3 percent decrease in price results in a
a. 0.6 percent increase in the quantity demanded.
b. 1.5 percent increase in the quantity demanded.
c. 2 percent increase in the quantity demanded.
d. 6 percent increase in the quantity demanded.
a
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Which of the following statements is true?
A) Maximum social surplus implies equity. B) Pareto efficiency implies equity. C) Taxation causes redistribution of wealth among the members in a society. D) Market prices act as signals that result in equal distribution of income and wealth in the society.
Expansionary fiscal policy normally lowers interest rates
a. True b. False Indicate whether the statement is true or false
In the first few years of the Great Depression, unemployment rose to about
a. 10 percent, and prices rose about 14 percent. b. 15 percent, and prices rose about 22 percent. c. 20 percent, and prices fell about 14 percent. d. 25 percent, and prices fell about 22 percent.
As long as existing firms ________ in an industry, some existing firms will exit the industry, causing the industry ________ curve to shift to the left.
A. break even; supply B. break even; demand C. incur economic losses; supply D. incur economic losses; demand