A product that has an elastic demand curve has all of the following characteristics EXCEPT
A) it has many substitutes.
B) a consumer can wait to buy the product.
C) it has few or no substitutes.
D) it is a large part of a consumer's income.
Answer: C
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Which of the following correctly describes the relationship between private-sector spending and the federal budget?
a. A decline in private-sector spending reduces the demand for government services, that reduces fiscal outlays and contributes to a budget surplus. b. An increase in private-sector spending must be matched by increase in government spending. This increases fiscal outlays and contributes to a budget deficit. c. A decline in private-sector spending triggers automatic stabilizers that result in a federal budget deficit. d. An increase in private-sector spending must be matched by increase in government spending. This increases fiscal outlays and contributes to a balanced budget.
In the above figure, along the section of the demand curve between point a and point b, demand is
A. inelastic. B. unit inelastic. C. elastic. D. unit elastic.