Refer to Scenario 19.4 below to answer the question(s) that follow. SCENARIO 19.4: Suppose demand for widgets is given by the equation P = 10 - 0.25Q. Originally, the price of the good is $5 per unit. When a tax of $1 per unit is imposed, the price of the good rises to $6 per unit.Refer to Scenario 19.4. Prior to the imposition of the tax consumers purchased ________ widgets and after the tax was imposed they purchased ________ widgets.
A. 20; 16
B. 40; 32
C. 10; 8
D. 16; 20
Answer: A
You might also like to view...
Cisco is considering opening a financial institution that accepts savings deposits from only its employees and makes loans to only its employees. The best description of this financial institution is that it is a
A) credit union. B) savings and loan association. C) federal government chartered credit bank. D) commercial bank. E) savings bank.
The Principle of Increasing Opportunity Costs states that:
A. opportunity costs increase when too little is produced. B. when increasing production, resources with the lowest opportunity costs should be used first. C. productive people do the hardest tasks first. D. when increasing production, resources with the lowest opportunity costs should be used last.
The more substitutes there are for a monopolist's product
A. the less elastic is the demand curve. B. the more elastic is the demand curve. C. the more positively sloped the demand curve becomes. D. the steeper is the demand curve.
Minimum efficient scale is defined as the level of output at which
A) all economies of scale are exhausted. B) diminishing returns affect average total cost. C) the firm's long-run average total cost starts falling. D) the maximum output is produced.