The ________ phase of the business cycle follows a recession
a. recession
b. peak
c. expansion
d. trough
d
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Suppose that, at the market clearing price of natural gas, the price elasticity of demand is -1.2 and the price elasticity of supply is 0.6. What will result from a price ceiling that is 10 percent below the market clearing price?
A) A shortage equal to 1.8 percent of the market clearing quantity B) A shortage equal to 0.6 percent of the market clearing quantity C) A shortage equal to 18 percent of the market clearing quantity D) A shortage equal to 6 percent of the market clearing quantity E) More information is needed.
If it costs View Your World, a high-end window manufacturer, $30 per window to install a higher quality glass in its windows and consumers will pay an additional $28 per window for the improvement, which of the following is true?
A) View Your World should not install the higher quality glass because the marginal revenue from the quality enhancement exceeds the marginal cost. B) View Your World should install the higher quality glass because the marginal revenue from the quality enhancement is less than the marginal cost. C) View Your World should install the higher quality glass because the marginal revenue from the quality enhancement exceeds the marginal cost. D) View Your World should not install the higher quality glass because the marginal revenue from the quality enhancement is less than the marginal cost.
In the late 1960s, Milton Friedman and Edmund Phelps argued that
a. the trade-off between inflation and unemployment did not apply in the long run This claim is consistent with monetary neutrality in the long run. b. the trade-off between inflation and unemployment did not apply in the long run. This claim is inconsistent with monetary neutrality in the long run. c. the trade-off between inflation and unemployment applied in both the short run and the long run. This claim is consistent with monetary neutrality in the long run. d. the trade-off between inflation and unemployment applied in both the short run and the long run. This claim is inconsistent with monetary neutrality in the long run.
Rising prices for a natural resource stimulate
A. the development of complements for the resource. B. the development of substitutes for the resource. C. the development of externalities from the resource. D. the tendency to consume before the resource expires.