This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: The price of a new toy increases from 5 to 7 and the quantity demanded decreases from 12,000 to ... (Read 163 times)

jjjetplane

  • Hero Member
  • *****
  • Posts: 556
on: Jun 30, 2018
The price of a new toy increases from 5 to 7 and the quantity demanded decreases from 12,000 to 6,000 per month as a result. Based on this information, the price elasticity of demand (in absolute terms) is estimated to be equal to:
 a. 0.5, indicating relatively elastic demand.
  b. 0.5, indicating relatively inelastic demand.
  c. 2.0, indicating relatively elastic demand.
  d. 2.0, indicating relatively inelastic demand.

Question 2

Suppose you found 10,000 hidden under a rock and deposited it in a demand deposit account at your bank. If the reserve requirement was 10 percent, your deposit would initially add ____ to total demand deposits and over time increase the money supply by a maximum of ____.
 a. 10,000; 100,000
  b. 10,000; 90,000
  c. 1,000; 90,000
 d. 1,000; 9,000


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

srodz

  • Sr. Member
  • ****
  • Posts: 333
Reply #1 on: Jun 30, 2018
Answer to Question 1

c

Answer to Question 2

a


jjjetplane

  • Member
  • Posts: 556
Reply 2 on: Jun 30, 2018
Wow, this really help

JaynaD87

  • Member
  • Posts: 368
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Vaccines cause herd immunity. If the majority of people in a community have been vaccinated against a disease, an unvaccinated person is less likely to get the disease since others are less likely to become sick from it and spread the disease.

Did you know?

Never take aspirin without food because it is likely to irritate your stomach. Never give aspirin to children under age 12. Overdoses of aspirin have the potential to cause deafness.

Did you know?

Asthma occurs in one in 11 children and in one in 12 adults. African Americans and Latinos have a higher risk for developing asthma than other groups.

Did you know?

GI conditions that will keep you out of the U.S. armed services include ulcers, varices, fistulas, esophagitis, gastritis, congenital abnormalities, inflammatory bowel disease, enteritis, colitis, proctitis, duodenal diverticula, malabsorption syndromes, hepatitis, cirrhosis, cysts, abscesses, pancreatitis, polyps, certain hemorrhoids, splenomegaly, hernias, recent abdominal surgery, GI bypass or stomach stapling, and artificial GI openings.

Did you know?

Many medications that are used to treat infertility are injected subcutaneously. This is easy to do using the anterior abdomen as the site of injection but avoiding the area directly around the belly button.

Gene duplication increases genetic complexity Gene duplication increases genetic complexity
(a) Longevity decreases with increased horn-length breeding value of harvested rams. (b) Mean-weight (a) Longevity decreases with increased horn-length breeding value of harvested rams. (b) Mean-weight
Cross-sectional data showing that the amount of effort spent on personal health care increases with Cross-sectional data showing that the amount of effort spent on personal health care increases with
More young men than women live in their parents’ homes, though the proportion for both decreases ... More young men than women live in their parents’ homes, though the proportion for both decreases ...
A dose-response curve describes the relationship between the quantity of the chemical entering the ... A dose-response curve describes the relationship between the quantity of the chemical entering the ...
Polyploidy increases fruit size Polyploidy increases fruit size
Video: Plant Defense Mechanisms from Pathogens

For a complete list of videos, visit our video library