Answer the following questions true (T) or false (F)
1. If the demand for a product is elastic, the quantity demanded changes by a smaller percentage than the percentage change in price.
2. If the absolute value of the price elasticity of demand for gasoline is 0.5, then a 10 percent increase in the price of gasoline leads to a 0.5 percent decrease in the quantity demanded.
3. If at a price of $10, a vendor sells 5 units of a product and at a price of $8, 6 units are sold. Using the midpoint formula, the demand for this good is inelastic.
1. FALSE
2. FALSE
3. TRUE
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When a firm faces a labor supply curve that is upward sloping, the firm must
A) offer a higher wage if it wishes to hire more workers. B) pay a wage that exceeds the value of marginal product. C) pay a wage that does not exceed the minimum wage. D) maximize the amount of labor that it hires.
Which of the following is least accurate about the US during World War I?
a. The armed forces increased from about 180,000 to 3 million. b. Soldiers were obtained through volunteer army and without a draft. c. Many new agencies were started to regulate prices. d. The US was a formal participant in the war for only 19 months.