Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point D to Point B, the opportunity cost of hybrid cars, measured in terms of motorcycles,
A. initially increases, then decreases.
B. increases.
C. remains constant.
D. decreases.
Answer: B
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Refer to Table 13-3. What is the best course of action for the firm in the short run?
A) It should not cut its price but it should increase its sales by advertising. B) It should stay in business because it covers some of its fixed cost. C) It should shut down. D) It should increase its sales by lowering its price.
If an item has several good substitutes, the demand curve for that item is likely to be
A) relatively inelastic. B) relatively elastic. C) perfectly inelastic. D) unit elastic.
The Federal Open Market Committee consists of:
a. the 12-member Board of Governors. b. seven members of the Board of Governors and five district presidents. c. the president of the New York district bank and the members of the Council of Economic Advisers. d. the chairman of the Board of Governors and five district presidents. e. seven members of the Board of Governors and a nine-member board of directors of the district banks.
Which of the following will reduce the risk of equity (stock) investments?
A) The purchase of shares of a mutual fund that holds the stocks of many diverse corporations. B) All of the above. C) The purchase of shares in firms doing business in a wider variety of industries and markets. D) The purchasing and holding of equities over a lengthy period of time.