ECON 1000 Study Guide - Midterm Guide: Economic Surplus, Economic Equilibrium, Marginal Cost

23) The price of good X falls and the demand for good Y decreases. We can conclude that A) X and Y are independent of each other. B) X and Y are substitutes. C) X is a normal good. D) X is an inferior good. E) X and Y are complements.

If a 10 percent increase in the price of good Y brings forth a 25 percent increase in the quantity demanded for good X, then the cross-price elasticity of demand is equal to ____, and good Y and good X are ____.

Select one:

a. 2.5; substitutes

b. 0.4; substitutes

c. unit-elastic; not related

d. 0.4; complements

e. 2.5; complements

Figure 28-7

In Figure 28-7, assume that the resource and output markets are perfectly competitive. If the wage rate is $60 per unit of labor and the output price is $5 a unit, the MRP of the third laborer is

Select one:

a. $5.

b. $125.

c. 25 units.

d. 43 units.

e. $215.