In which of the following cases will the total spending on a good decrease?
a. Demand is inelastic, and price increases.
b. Demand is elastic, and price increases.
c. Demand is elastic, and price decreases.
d. Demand is of unit elasticity, and price decreases.
B
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The conclusion that the level of output is efficient at the market equilibrium rests on all of the following assumptions EXCEPT that __________.
A. buyers and sellers are well-informed B. there are no external costs or benefits C. the government regulates price and output D. the market is perfectly competitive
If the MPC is 0.8, and the government spends an additional $100b, the overall effect on GDP will be:
A. $400b. B. $180b. C. $500b. D. $120b.
The basic goals of total utility maximization, total profit maximization, and total welfare maximization explain most market activity.
Answer the following statement true (T) or false (F)
In general, the entry-deterrence game will generate a market price:
A. higher than the monopoly price. B. lower than the monopoly price but higher than the duopoly price. C. the same as the monopoly price. D. the same as the duopoly price.