In general, the smaller the numerical value of price elasticity (in absolute value):
a. ?the smaller the responsiveness of price to changes in consumers' quantity demanded.
b. ?the smaller the responsiveness of consumers' quantity demanded to changes in price.
?c. the larger the responsiveness of price to changes in consumers' quantity demanded.
?d .the larger the responsiveness of consumers' quantity demanded to changes in price.
Answer: ?the smaller the responsiveness of consumers' quantity demanded to changes in price.
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When the desired reserve ratio is 10 percent, suppose the Fed buys $1,000,000 of government securities from banks. As a result, the banks' excess reserves
A) increase by $900,000. B) increase by $1,000,000. C) increase by $10,000. D) decrease by $10,000. E) decrease by $1,000,000.
As the interest rate increases, the opportunity cost of holding money __________ and individuals choose to hold __________ money
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