Refer to the above graph. When the quantity of product X sold increases from 14,000 to 16,000, the price elasticity of demand for product X is:
A. perfectly inelastic.
B. unit-elastic.
C. inelastic.
D. elastic.
Answer: C
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If autonomous spending decreases, then
A) the expenditure multiplier means that equilibrium expenditure increases by a larger amount. B) the expenditure multiplier means that equilibrium expenditure increases by a smaller amount. C) equilibrium expenditure does not change. D) the expenditure multiplier means that equilibrium expenditure decreases by a larger amount. E) equilibrium expenditure decreases by the same amount.
A virtuous cycle occurs
A) when a firm can attract enough buyers initially to increase a product's usefulness to attract even more buyers. B) when lobbyists petition members of Congress to grant a public franchise; the lobbyist then raise money for those Congress members who granted the franchise. C) when monopoly profits are used to create new products for additional monopoly profits. D) when a firm's sales volume reaches a level where the firm can take advantage of economies of scale; thereby reducing the price of the product to further boost its sales.
If an increase in price causes total revenue to decrease, we can conclude that demand is price elastic
Indicate whether the statement is true or false
Distinguish between scarcity and shortages
What will be an ideal response?