A decrease in the market price of a product will reduce producer surplus because new producers will enter the market

The income elasticity of demand is

A) positive for a normal good. B) zero for an inferior good. C) less than one for an income elastic normal good. D) Only answers A and B are correct. E) Answers A, B, and C are correct.

If a central bank does not want to allow the domestic currency to appreciate, it will ________ international reserves by selling its currency, thereby ________ the monetary base and increasing the risk of higher inflation

A) lose; decreasing B) lose; increasing C) acquire; decreasing D) acquire; increasing