Arrange the following goods from least to most elastic, explaining your ordering: gasoline, Shell gasoline, and Shell gasoline at a particular gas station
Gasoline is least elastic, since there are few substitutes for it available to power automobiles. Shell gas at a particular station is most elastic, since one can substitute other Shell stations or other brands of gas.
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Everything else constant, the international trade effect indicates that aggregate expenditures in the domestic economy fall when:
a. domestic prices fall relative to foreign prices. b. domestic interest rates fall relative to foreign interest rates. c. domestic prices rise relative to foreign prices. d. domestic purchasing power rises relative to foreign purchasing power. e. domestic interest rates rise relative to foreign interest rates.
When explaining expansions and recessions, the classical model is
a. reliable b. seriously flawed c. the favorite explanatory tool of economists d. overly focused on the labor market e. sometimes accurate and sometimes not