Suppose N consumers each have an identical demand curve for a good is given by Q = a - bp, where Q is the quantity demanded, p is the price, and a and b are positive constants
What is the market demand curve? Is the slope (in price) of the market demand greater or less than the slope of each individual demand curve?
The market demand is QM = N • Q = N(a - bp) = Na - Nbp. The slope of the market demand is Nb which is greater (more flat on graph) than the individual demand curve.
You might also like to view...
If the fixed costs are relatively large, a relatively good approximation to the correct transfer price is
a. average costs b. average fixed costs c. average variable costs d. the market price
If pretzels are a normal good, the income effect of a price change means that
a. as income increases, the quantity demanded increases along the demand curve for pretzels b. as income increases, the demand curve for pretzels shifts rightward c. as income increases, the demand curve for pretzels shifts leftward d. as the price of pretzels increases, the real income of individuals who demand pretzels decreases, so the quantity demanded of pretzels decreases e. as the price of pretzels increases, income increases
Which of the following is true?
What will be an ideal response?
Why does minimum wage affect teenagers more negatively than other age groups?
a. They are too young to be hired for minimum-wage jobs. b. They are not experienced enough to get minimum-wage jobs. c. They are choosy about the jobs they take, so they turn down minimum-wage work. d. They prefer focusing on school than work that pays a minimum wage.