If a 10 percent decrease in the price of one good generates a 3 percent increase in the quantity demanded for another good, then the
a. two goods are complementary
b. cross elasticity between the two goods is positive
c. two goods are substitutes
d. price elasticity of demand for the good whose quantity demanded increased must be inelastic
e. price elasticity of demand for the good whose quantity demanded increased must be elastic
A
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In the figure above, S is the supply curve and D is the demand curve in the unregulated, competitive market for gasoline in Motorland. The external cost of gasoline is constant at $1.50 per gallon
The unregulated, competitive market for gasoline in Motorland A) produces the efficient quantity of gasoline. B) overproduces by 0.2 million gallons of gasoline a month. C) underproduces by 0.1 million gallons of gasoline a month. D) overproduces by 0.1 million gallons of gasoline a month.
Protection of new products from global competition is known as
A) the infant-industry argument. B) dumping. C) a quota. D) protection of domestic jobs.