Economists use elasticity to measure the responsiveness of quantity to a change in price rather than the slope of the demand curve because elasticity is
A) independent of the units of measurement.
B) dependent on the units of measurement.
C) easier to calculate.
D) harder to calculate.
E) always negative whereas the slope is always positive.
A
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Scarcity: a. exists in command economies
b. exists in market economies. c. exists only for the poor in any type of economy. d. (a) and (b) above are correct
A firm that sells its output and hires its labor in perfectly competitive markets
a. controls the price of its output, but accepts the wage rate it pays as given b. controls both the price of its output and the wage rate it pays c. controls the rate it pays, but accepts the price of its output as given d. accepts both the price of its output and the wage rate it pays as given e. controls the price of its output, the wage rate it pays, and its own output level
Suppose that Spain has a comparative advantage in hats and Portugal has a comparative advantage in doormats. Under a system of free trade, each country specializes and then trades with the other. If the price increases from four hats per doormat to five hats per doormat,
a. people in Portugal will not want to buy as many hats b. Spain no longer has a comparative advantage in hats c. Portugal no longer has a comparative advantage in doormats d. some of the gains from trade shift to Portugal e. some of the gains from trade shift to Spain
The textbook points out that rent controls have
A. greatly benefited the homeless. B. attracted increases in low-income housing. C. had no effect on the market for housing. D. benefited upper-income or existing tenants.