A university raises annual tuition by 10 percent. No other events have occurred, and the university's revenues have increased. It must be TRUE that
A. there was no associated change in quantity demanded.
B. the associated change in quantity demanded was greater than 10 percent.
C. the associated change in quantity demanded was smaller than 10 percent.
D. the associated change in quantity demanded was equal to 10 percent.
Answer: C
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If the market price of a good does NOT include all of the costs and benefits that arise from the production or consumption of the good, then
A) the market is perfectly competitive. B) an externality is present. C) society is consuming and producing the optimal amount of the good. D) resources are properly allocated.
Which of the following will not change the U.S. real interest rate?
a. capital flight from the United States b. the government budget deficit increases c. the U.S. imposes import quotas d. None of the above is correct.