Suppose the equilibrium price in the market is $100 and the marginal revenue associated with the linear (inverse) demand function is $50. Then we know that the own price elasticity of demand is:
A. 2.
B. ?2.
C. 1.
D. It cannot be determined from the information contained in the question.
Answer: B
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Isabel receives a check for $7,000 from Kermit and deposits it in her bank. Suppose that the reserve ratio is 10 percent. As a result of this transaction the money supply will
A) decrease by $63,000 and then increase by $70,000. B) increase by $70,000. C) decrease by $70,000 and then increase by $63,000. D) not change.
Suppose it costs a farmer $1.00 to produce 1 unit of corn, $2.10 to produce 2 units of corn, and $3.30 to produce 3 units of corn. What's the marginal cost of producing 3 units of corn?
A) 0 B) 30 cents C) $1.10 D) $1.20 E) $3.30
The slope of an upward-sloping line is positive, and the slope of a downward-sloping line is negative
a. True b. False Indicate whether the statement is true or false
Decreasing aggregate demand to eliminate an inflationary gap often creates the problem of
A. unemployment. B. increasing real GDP. C. increasing inflation. D. increasing the labor force.