When the percentage change in price is greater than the corresponding change in quantity demanded, demand is inelastic. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
The fact that a firm is using a capital-intensive method of production means that input substitution is not possible. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
“Supply” is best defined as the relationship between: A) the current price of a good and the quantity supplied at that price. B) the price of a good or service and the quantity supplied by producers at each price during a period of time. C) the cost of producing a good and the price consumers […]
Date: September 10th, 2020
In the prisoner’s dilemma game, each player’s dominant strategy is also the Nash equilibrium. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
If desired spending is less than output, then firms: A) accumulate their inventories and cut production. B) deplete their inventories and cut production. C) deplete their inventories and increase production. D) accumulate their inventories and increase production. ANSWER A
Date: September 10th, 2020
A firm is more likely to use a labor-intensive method of production when the relative amount of available labor is greater than the available amount of capital. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
Assume that when the price of good X is $7, quantity demanded is 25. When price is increased to $9, quantity demanded falls to 20. Based on this information, over the range in question demand is elastic. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
The change in import spending due to a change in domestic real income is called: A) marginal propensity to save. B) marginal propensity to consume. C) marginal propensity to import. D) none of the above. ANSWER C
Date: September 10th, 2020
All else constant, an increase in the price of labor would cause the total amount of output that can be produced with a fixed amount of spending to ________. This would result in a movement to a ________ isoquant. A) increase; lower B) increase; higher C) decrease; lower D) decrease; higher ANSWER C
Date: September 10th, 2020
The kinked demand curve model is based on the assumption that firms’ pricing decisions are independent of one another because demand is determined by non-market forces. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
