Category: Economics

➤ Why do memory cards respond to changes in camera prices?
Memory cards respond because buyers purchase them to store photos from cameras. A higher camera price reduces camera sales, which lowers derived demand for accessories like memory cards. This reflects cross-price effects: an increase in one good’s price reduces demand for its complements and shifts their demand curve leftward.

Question 16 In the calculation of national income, dividends paid to stockholders are part of
rental income.
compensation of employees.
corporate profits.
proprietors’ income.

➤ How is cross-price elasticity of demand calculated and interpreted for similar goods?
Calculate cross-price elasticity as percent change in quantity demanded of good X divided by percent change in price of good Y: (%ΔQx / %ΔPy). A positive value signals substitutes; the larger the positive number, the closer the goods are as substitutes. Use consistent base and mid-point method for accuracy.

Thomas Malthus believed that there were too many people in the world, and that the solution to poverty was birth control, forced abortions and sterilizationsTrue or False

Once someone is impeached, what happens next?
They must leave office.
They are fined or sentenced to prison.
They go on trial in the Senate.
They appeal to the Supreme Court.

Suppose an individual consumer’s demand curve is given by Qx(Px)=2Px.
This consumer’s price elasticity of demand when Px=1 is equal to:
-0.5
-1
-0.2
-0.1
-2

If the production possibilities frontier is ________, then opportunity costs are constant as more of one good is produced.
Group of answer choices
non-linear
bowed in
linear