Demand is elastic if the price elasticity of demand is
a. less than 1.
b. equal to 1.
c. equal to 0.
d. greater than 1.
d
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If the economy is at full employment, then the unemployment rate
A) is greater than the natural unemployment rate. B) is equal to the natural unemployment rate. C) is below the natural unemployment rate. D) is equal to zero. E) can be anywhere on a short-run Phillips curve.
If India decides to enact environmental laws to reduce air pollution, what would be the effect on GDP?
A) GDP would decrease if the pollution controls reduce productivity by more than the cost of the controls. B) GDP would increase as the environmental costs of pollution were not included in the calculation of GDP. C) GDP would increase as the citizens of India were made happier as the air pollution was reduced. D) GDP would increase reflecting the fact that the air would be cleaner.