If the exchange rate between the dollar and Japanese yen is below the equilibrium exchange rate, there will be a ________ of dollars, and the exchange rate will ________
A) surplus; fall to the equilibrium level
B) shortage; change only when the supply curve shifts leftward
C) shortage; rise to the equilibrium level
D) surplus; rise to the equilibrium level
C
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A market is classified as monopolistically competitive when
A) there is a barrier that blocks entry by other firms. B) a small number of firms compete. C) many firms produce the same product. D) many firms produce a slightly differentiated product. E) there is one firm that sells a good or service with no close substitutes.
On a certain supply curve, one point is (quantity supplied = 200, price = $2.00) and another point is (quantity supplied = 250, price = $2.50). Using the midpoint method, the price elasticity of supply is about
a. 0.2. b. 0.5. c. 1.0. d. 2.5.