What does it mean for a good to be non-rival in consumption?
What will be an ideal response?
A good is non-rival in consumption if one person's enjoyment of the benefits of the good does not interfere with another's consumption.
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The equilibrium real interest rate is 5 percent. If the real interest rate is
A) anything other than 5 percent, the supply of loanable funds curve and/or the demand for loanable funds curve will shift to move the real interest rate to 5 percent. B) 6 percent, the demand for loanable funds curve will shift rightward as firms enter the market to borrow at the lower rate. C) 2 percent, there is a shortage of loanable funds. D) 8 percent, there is a surplus of loanable funds. E) 3 percent, then the supply of loanable funds curve will shift leftward as new savers enter the market.
As income levels rose moderately last year in the San Jose area, it was observed by local realtors that housing sales increased substantially. It is clear from this information that, everything else held constant, the income elasticity of demand for houses is _____
a. negative and relatively low b. negative and relatively high c. positive and relatively low d. positive and relatively high e. neither positive nor negative