ECO 365 Final Exam

ECO 365 Final Exam Which of the following statements is true about a downward-sloping demand curve that is a straight line? The slope remains the same, but elasticity falls as you move down the demand curve. The slope and the elasticity fall as you move down the demand curve. The slope remains the same, but elasticity rises as you move down the demand curve. The slope and elasticity are the same at all points. The best example of positive externality is: Roller coaster rides Pollution...

ECO 365 Final Exam 1) An economist who is studying the relationship between the money supply, interest rates, and the rate of inflation is engaged in A. microeconomic research B. macroeconomic research C. theoretical research, because there is no data on these variables D. empirical research, because there is no economic theory related to these variables 2) A basic difference between microeconomics and macroeconomics is that microeconomics A. focuses on the choices of individual consumers, whil...

ECO 365 Final Exam In 1997, the federal government reinstated a 10 percent excise tax on airline tickets. The industry tried to pass on the full 10 percent ticket tax to consumers but was able to boost fares by only 4 percent. From this you can conclude that the: Demand for airline tickets is perfectly inelastic. Supply of airline tickets is perfectly inelastic. Demand elasticity for airline tickets is greater than zero in absolute value. Supply elasticity of airline tickets is less than infin...

ECO 365 Final Exam 1). The DeBeers company is a profit-maximizing monopolist that exercises monopoly power in the distribution of diamonds. If the company earns positive economic profits this year, the price of diamonds will: • Exceed the marginal cost of diamonds but equal to the average total cost of diamonds. • Exceed both the marginal cost and the average total cost of diamonds. • Be equal to the marginal cost of diamonds. • Be equal to the average total cost of diamonds. 2)...