If the short run elasticity of demand for widgets is 0.7 and the long run elasticity of demand for widgets is 1.5, a decrease in price will ____ total revenue in the short run and ____ total revenue in the long run.
a. Increase; increase

Refer to Figure 7-2. With the tariff in place, the United States produces

A) 18 million pounds of coffee. B) 20 million pounds of coffee. C) 26 million pounds of coffee. D) 38 million pounds of coffee.

Higher interest rates

A) reduce total planned real expenditures because they increase the cost of borrowing funds. B) reduce total planned real expenditures because they reduce the income of bankers and other creditors. C) increase total planned real expenditures because they increase the incomes of all people in the economy. D) increase total planned real expenditures because they lower the costs of building new plants and equipment.