All else equal, the price elasticity of demand for small-budget items such as soap tends to be ________ than the price elasticity of demand for big-ticket items such as flat-screen TVs.
A. lower
B. higher
C. very high
D. the same
Answer: A
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Suppose Stan transfers $1,000 from his savings account into his checking account. What are the effects on M1 and M2 money supply?
A) M1 increases; M2 remains the same. B) M1 decreases; M2 increases. C) Both M1 and M2 increase. D) Both M1 and M2 decrease. E) Both M1 and M2 remain the same.
An increase in the interest rate will increase consumption spending
a. true b. false
Assuming there is no foreign trade in the economy, the economy is in equilibrium when
A. G + T = S + I. B. I + G = S + T. C. S + T = C + I. D. IT = S + G.
Ethyl does not like redheads and refuses to hire any at her business. Paul was the perfect job candidate on paper, but the personal interview revealed that he was a redhead. Are there any costs to Ethyl for not hiring Paul?