Elasticity of supply will increase when:
A. it becomes easier to substitute one factor of production for another in a manufacturing process.
B. producers are given less time to respond to price changes.
C. the number of consumers wanting to purchase a product increases.
D. the number of producers selling a product decreases.
Answer: A
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Suppose that the firms in an oligopolistic industry successfully collude. What will be the outcome? Explain
What will be an ideal response?
Refer to Figure 21-3. Which of the following is consistent with the graph depicted above?
A) Taxes are changed so that real interest income is taxed rather than nominal interest income. B) Technological change increases the profitability of new investment. C) The government runs a budget deficit. D) An expected recession decreases the profitability of new investment. Figure 21-4
Marginal labor cost is defined as the addition to
a. output a firm would receive after hiring one more laborer b. total cost from hiring one more laborer c. revenue earned by selling one more unit of a good d. revenue earned by hiring one more laborer e. output received by spending one more dollar on labor
An important result in long-run equilibrium in monopolistic competition is that the equilibrium point results in
A. price = MR. B. price = ATC. C. price is greater than ATC. D. ATC = MC.