The definition of cross elasticity of demand for two products X and Y is
a. percentage change in quantity of X demanded/percentage change in quantity of Y demanded.
b. percentage change in price of Y/percentage change in quantity of X demanded.
c. percentage change in price of Y/percentage change in price of X.
d. percentage change in quantity of X demanded/percentage change in price of Y.
d
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Export promotion is widely regarding by economists as a positive role for government policy makers to play because it is very effective at promoting economic growth
Indicate whether the statement is true or false
You are the chairperson of the Board of Governors of the Federal Reserve. You believe in a Keynesian model of the economy, and your goal is to keep the economy at the full-employment level of output
How would you respond (tightening or easing policy) in each of the following cases? (a) Government purchases increase (b) Corporate tax rates increase (c) Expected inflation increases (d) There's a beneficial oil price shock (and the LM curve shifts more to the right than the FE line)