The price of a smartphone increased from $250 to $400 while the price of a smartphone app increased from $1 to $2. The relative price of smartphones in terms of smartphone apps
A) increased from 175 to 350.
B) decreased from 250 to 200.
C) increased from 0.003 to 0.05.
D) decreased from 0.35 to 0.2.
Answer: B
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If an increase in the level of money supply leads to a proportionate increase in prices with no effect on real variables ,we say that
A) the Fisher relationship holds. B) money is neutral. C) money is superneutral. D) money is a medium of exchange.
As the number of transactions in the economy decreases,
a) the supply of money increases b) the supply of money decreases c) the demand for money increases d) the demand for money decreases
Although the Federal Reserve had traditionally made discount loans only to commercial banks, in response to the financial crisis in 2008 the Fed made ________ eligible for discount loans as well
A) the Treasury Department B) mortgage brokers C) savings banks D) primary dealers
When will an industry's long-run supply curve be horizontal at firms' break-even price?
a. When expansion of the industry allows new input markets to develop. b. When some firms are more efficient than others. c. When specialized skills play a significant role in production. d. When firms are identical and there is no factor-price effect.