If the price elasticity of supply is 0.3, supply is:
A. unaffected by price changes.
B. inelastic.
C. unit elastic.
D. elastic.
Answer: B
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What will be an ideal response?
Potential advantages of nominal GDP targeting include
A) it implies that the central bank will respond to slowdowns in the real economy even if inflation is not falling. B) real GDP growth that is below potential or inflation that is below the inflation objective will encourage more expansionary monetary policy. C) it focuses not only on controlling inflation but also explicitly on stabilizing real GDP. D) all of the above.
The term institutions is commonly used to refer to:
A. development agencies. B. international groups. C. government bodies. D. All of these statements are true.
According to economic analysis, the optimal quantity of pollution exists at the point at which the
A) total benefit of pollution control is equal to the total cost. B) marginal benefit of pollution control is equal to the marginal cost. C) level of pollution is at zero. D) level of pollution is acceptable to the society.