If demand is perfectly elastic,
A) the smallest increase in price will cause quantity demanded to fall to zero.
B) the smallest increase in price will cause demand to fall to zero.
C) the smallest increase in price will cause quantity demanded to fall.
D) the smallest increase in price will cause demand to fall.
QUESTION 2Health care expenditures in the U.S. made up approximately ____ of the total value of the GDP in 2010.
a. 20.1 percent
b. 17.9 percent
c. 13.5 percent
d. 9.8 percent
QUESTION 3Which of the following is true of a vanilla bond?
a. It realizes capital gains in multiples of 1,000.
b. It provides a fluctuating stream of interest income every year.
c. It assures a return higher than the market rate of interest.
d. It has a par value payable after a certain number of years from its issuance.
QUESTION 4If something is addictive, then
A) price and demand are inversely related.
B) price elasticity of demand is equal to one.
C) demand is perfectly inelastic.
D) demand is perfectly elastic.
QUESTION 5Which welfare program allows the working poor to receive income refunds that can be greater than the taxes they paid during the last year?
a. SSI
b. TANF
c. EITC
d. Medicaid
QUESTION 6Assume that the interest rate on a federally insured deposit declines from 15 percent per annum to 10 percent. If an individual holding a U.S. Treasury bill worth 2,500 plans to sell it after this drop in interest rate, he would realize (approximately) a:
a. capital gain worth 99.
b. capital loss worth 100.
c. capital gain worth 100.
d. capital loss worth 99.
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