Total revenue decreases if price ________ and demand is ________.
A. rises; inelastic
B. rises; unit elastic
C. falls; elastic
D. falls; inelastic
Answer: D
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The number of units of the good on the horizontal axis that we are willing to give up to get one more unit of the good on the vertical axis is equal to the absolute value of the slope of the indifference curve.
Answer the following statement true (T) or false (F)
Bus rides and canned soup are inferior goods, so the ________ elasticity of demand is ________
A) cross; positive B) income; positive C) income; negative D) cross; negative
If a Japanese pension fund decides to purchase U.S. government bonds, what is the effect in the exchange market? a. It will increase the supply of U.S. dollars
b. It will decrease the supply of U.S. dollars. c. It will increase the demand for U.S. dollars. d. It will decrease the demand for U.S. dollars.
What is the difference between a "free" good and a "scarce" good?
What will be an ideal response?