In the real world, demand is not likely to be perfectly inelastic at every price because
a. no substitutes exist for some goods
b. some consumers will be unable to afford very high prices with given incomes
c. at low prices, consumers always want a lot
d. consumers are willing to pay any price for certain goods
e. the prices of certain goods don't change
B
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When quantity supplied is very responsive to a change in price, supply is
A) elastic. B) unit-elastic. C) inelastic. D) income sensitive.
Which of the following is a characteristic of stock?
A) Stock represents a promise to repay a fixed amount of funds. B) The face value or principal plus interest is repaid at a specified period of time. C) The length of coupon payments is fixed by the stated maturity period. D) Stock represents ownership in a firm
Those that believe that the recent period of slow growth will pass and that higher levels of growth can be anticipated
A. believe we have to get used to slower growth and hope for the best. B. have blind faith and not much else. C. believe that the causes of older growth (increases in the labor force participation rate and the use of energy to replace people power) are still available. D. believe we are on the cusp of a period of new (artificial intelligence-based) innovations.
A market has four individuals, each considering buying a grill for his backyard. Assume that grills come in only one size and model. Abe considers himself a grill-master, and finds a grill a necessity, so he is willing to pay $400 for a grill. Butch is a meat-lover, honing his grilling skills, and is willing to pay $350 for a grill. Collin just met the girl of his dreams, and she loves a good grilled steak, so in his effort to impress her he is willing to pay $320 for a grill. Daniel loves grilled shrimp and thinks it might be cheaper in the long run if he buys a grill instead of eating out every time he wants grilled shrimp, so he is willing to pay $200 for a grill.Given the scenario described, if the market price of grills falls from $395 to $340, then we can say:
A. Butch's consumer surplus decreases from $10 to $0, and total consumer surplus increases from $10 to $80. B. Abe's consumer surplus decreases from $60 to $5, and total consumer surplus decreases from $70 to $5. C. Collin's consumer surplus increases from $0 to $20, and total consumer surplus increases from $5 to $70. D. Abe's consumer surplus increases from $5 to $60, and total consumer surplus increases from $5 to $70.