If technological change increases the profitability of new investment for firms, then the ________ curve for loanable funds will shift to the ________ and the equilibrium real interest rate will ________.
A) demand; right; rise B) demand; left; fall C) supply; left; rise D) supply; right; fall
Ques. 2Two economists from Northwestern University estimated the benefit households received from subscribing to broadband Internet service.
They found that in the year they analyzed, 47 million consumers paid an average of 36 per month to subscribe to a broadband Internet service, and estimated the value of total consumer surplus for these subscribers was equal to 890.4 million. Based on these numbers, what was the average monthly consumer surplus per subscriber for broadband Internet service?
A) 0.05 B) 0.77 C) 13.06 D) 18.94
Ques. 3Suppose the price of gasoline in July 2004 averaged 1.35 a gallon and 15 million gallons a day were sold. In October 2004, the price averaged 2.15 a gallon and 14 million gallons were sold.
If the demand for gasoline did not shift between these two months, use the midpoint formula to calculate the price elasticity of demand. Indicate whether demand was elastic or inelastic.
Ques. 4Assume the United States has an absolute advantage in the production of everything compared to the African nation of Berundi. Can you think of any reason why both nations would still find it to their mutual advantage to trade with each other?
What will be an ideal response?
Ques. 5If the personal assets of the owners cannot be claimed if the business is bankrupt, the owners are said to have
A) a partnership type of business. B) unlimited liability.
C) a proprietorship type of business. D) limited liability.
Ques. 6What is the law of diminishing marginal utility?
What will be an ideal response?
Ques. 7Economist Steve Landsburg has pointed out that Ebenezer Scrooge's change in behavior from miser to spender might actually be detrimental to the economy because
A) saving has to be greater than consumption for the economy to grow.
B) Scrooge was happiest when he was saving money, and happiness is the key to economic growth.
C) Scrooge's miserly saving helped contribute to the production of investment goods rather than consumption goods.
D) Scrooge's consumption habits were more detrimental to the environment than were his earlier saving habits.
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