The expanded circular flow model is a complex set of money, resource, and product flows in and out of households, firms, government, and foreign economies. If you account for each of the in and out flows, you can conclude that
a. investment must be zero
b. savings can be greater than investment
c. savings can be smaller than investment
d. savings must equal investment
e. savings must equal zero
D
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Price discrimination is the practice of
A) charging different prices for the same good when the price differences arise because of differences in cost. B) charging different prices for the same good when the price differences are not due to differences in cost. C) charging higher prices for brand-named goods and lower prices for generic versions of the goods. D) charging different prices for different qualities of a product.
A measure of the responsiveness of the demand for one good to the percentage change in the price of another good is
A) price elasticity of demand. B) price elasticity of supply. C) cross price elasticity of demand. D) income elasticity.