In general, the smaller the price elasticity:
a. the smaller the responsiveness of price to changes in quantity.
b. the smaller the responsiveness of quantity to changes in price.
c. the larger the responsiveness of price to changes in quantity.
d. the larger the responsiveness of quantity to changes in price.
b
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Refer to Scenario 10.6. If red rubber balls can be produced at any of the three plants, and John decides to produce 1 red rubber ball, at which plant will he produce it?
A) California B) Florida C) Montana D) He is indifferent between California and Florida. E) He is indifferent between Florida and Montana.
If the short-run Phillips curve was a straight line with a very steep slope, the inflation costs of reducing unemployment: a. are fairly low
b. are fairly high. c. depend on the current rate of inflation. d. rises as the economy approaches full employment.