Refer to Figure 6-2. The absolute value of the price elasticity of demand at points a and b is 1. What is the value of Pb?

Businesses typically issue bonds to finance

A) their inventories. B) payments to their workers. C) spending on new plant and equipment. D) dividend payments to their stockholders.

When the consumer spends a small portion of his income on a good, demand will be

A) elastic. B) unit-elastic. C) inelastic. D) elastic, unit-elastic or inelastic depending upon supply.