A decrease in stock prices alters the consumption function by:
A. decreasing the vertical intercept.
B. decreasing the slope.
C. increasing the vertical intercept.
D. increasing the slope.
Answer: A
You might also like to view...
Suppose the short-run price elasticity of demand for airline travel is 0.50, while its long- run elasticity is 2.50 . This means that for 100 short-notice travelers compared to 100 travelers who book well in advance, a significant increase in airline fares now will cause airlines to
a. collect less revenue from the short-notice travelers than from the travelers who book well in advance b. gain travelers who book well in advance but lose short-notice travelers c. lose more revenue from short-notice travelers than from travelers who book well in advance d. collect less revenue from the travelers who book well in advance than from the short-notice travelers e. lose more short-notice travelers than travelers who book well in advance
Which of the following is a characteristic of a competitive market?
a. There are many buyers but few sellers. b. Many firms have market power because they own patents. c. Buyers and sellers are price takers. d. Firms sell differentiated products.