If the price of wireless phone service decreases and the demand for wired phone services decreases, then wired and wireless phone services are
A) substitutes.
B) complements.
C) inferior goods.
D) elastic goods.
Answer: A
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Which if the following is the best example of a public good?
a. Bread. b. Fish in the ocean. c. Scrambled satellite broadcasts. d. National defense.
A consulting company estimated market demand and supply in a perfectly competitive industry and obtained the following results:Qd = 25,000 ? 5,000P + 25MQs = 240,000 + 5,000P ? 2,000PI where P is price, M is income, and PI is the price of a key input. The forecasts for the next year are 
? = $15,000 and 
I = $20. Average variable cost is estimated to beAVC = 14 ? 0.008Q + 0.000002Q2 Total fixed cost will be $6,000 next year. What is the price forecast for next year?
A. $12 B. $68 C. $60 D. $20
We use percent-changes in the formula for estimating the price elasticity of demand coefficient in order to:
A. Make the coefficient's value become independent of whether price goes up or down B. Take the midpoints of P and of Q in the computation C. Eliminate the negative sign of the coefficient D. Make it irrelevant how we measure price: be it in cents, in dollars, or in thousands of dollars
For the unregulated, single-price monopoly shown in the figure above, when its profit is maximized, output will be
A) 4 units per year and the price will be $6. B) 4 units per year and the price will be $4. C) 6 units per year and the price will be $4. D) None of the above answers is correct.