Suppose fish steak and spaghetti are the only alternatives available during lunch hours at an office cafeteria. If a nominal change in the price of fish steak brings about a prominent change in the demand for spaghetti we can conclude that the latter has a high demand elasticity
Indicate whether the statement is true or false
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Which of the following is NOT true of a demand curve?
A. It reflects sellers' reservations prices. B. It shows the amount consumers want to buy at various prices. C. It has negative slope. D. It relates the price of an item to the quantity demanded of that item.
Production efficiency requires that
A) the economy be producing on the PPF but the marginal cost of a good does not need to equal its marginal benefit. B) the economy be producing on the PPF and that the marginal cost of a good equals its marginal benefit. C) the marginal cost of a good equals its marginal benefit but the economy does not need to be producing on its PPF. D) the society be producing at the point of allocative efficiency. E) opportunity costs be minimized.
Big Waves is a large water park. Suppose the individual demand for entrance into Big Waves is Qd = 50 - (2 × P) and each consumer has the same demand. Big Waves has a constant marginal cost of $5 per consumer. If Big Waves practices two-part pricing and charges the profit-maximizing membership fee and entrance fee, what is the profit per consumer?
A) $50 B) $500 C) $200 D) $400
With a natural monopoly, the fair return price:
A. Is allocatively efficient; the socially optimal price is allocatively inefficient B. Is allocatively inefficient; the socially optimal price is allocatively efficient C. And the socially optimal price are both allocatively inefficient D. And the socially optimal price are both allocatively efficient