The larger the share of a good in a consumer's budget, holding everything else constant, the
A) more price elastic is a consumer's demand.
B) more vertical is a consumer's demand curve.
C) more price inelastic is a consumer's demand.
D) more unit elastic is a consumer's demand.
Answer: A
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According to mainstream macroeconomists, U.S. macro instability has resulted from
A. adherence by the Fed to a monetary rule. B. wide fluctuations in net exports. C. changes in investment spending. D. government's attempts to balance its budget.
In which oligopoly model(s) do firms earn zero profit?
A) Cournot B) Bertrand C) Stackelberg D) Oligopoly firms always earn positive economic profits.
The government introduced a requirement that all gasoline used in the US must use an increased share of ethanol in the gasoline sold. Consider the market of corn - a commodity which is used in ethanol production. Indicate whether there is a shift in supply (S) or demand (D).
a. Demand b. Supply
Economists assume the principal motivation of producers is
A. Psychological gratification. B. Profit. C. Social status. D. Their preference for being "their own person."