When the price of milk rose 50 percent, the quantity of milk sold fell 25 percent and the sale of breakfast cereals also fell 25 percent. This set of facts indicates that the
A) demand for milk is price elastic.
B) demand for breakfast cereals is price elastic.
C) cross elasticity between milk and cereal is negative so the two are complements.
D) cross elasticity between milk and cereal is positive so the two are complements.
C
Economics
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In which of the following assets are commercial banks in the United States NOT allowed to invest checkable deposits?
A) home mortgages B) corporate bonds C) municipal bonds D) U.S. Treasury bonds
Economics
Economists develop models to
A) capture every detail of the real world. B) make their arguments more realistic. C) justify the assumptions they make about people's behavior. D) help us understand economic phenomena in the real world.
Economics