The demand for a product tends to be less elastic as the product accounts for a larger fraction of a consumer's budget.

Rate of return regulation is most similar to

A) a marginal cost pricing rule. B) an average cost pricing rule. C) an average variable cost pricing rule. D) an inflation cost pricing rule.

The Fed's policy tools include all the following except _______

A. required reserve ratio and open market operations B. quantitative easing C. discount rate D. taxing banks' deposits at the Fed