Which of the following statements is true?
a. If price decreases and demand is relatively elastic then the total expenditure by consumers will decrease.
b. If price increases and demand is relatively inelastic then the total expenditure by consumers will decrease.
c. Total expenditure by consumers is constant along a linear demand curve.
d. All of the above.
e. None of the above
Ans: e. None of the above
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Under the theory of purchasing power parity, an increase in the U.S. price level of 10% relative to the Japanese price level will result in
A) a 10% appreciation of the yen. B) a 10% appreciation of the dollar. C) an appreciation of the yen by an amount that depends upon what happens to the real exchange rate. D) an appreciation of the dollar by an amount that depends upon what happens to the real exchange rate.
Suppose bank A has assets of 100, liabilities of 60, and capital of 40. Its leverage ratio is
A) 1.5. B) 2.5. C) 0.6. D) 0.4.