The value of the absolute price elasticity of demand for good A is 4. The absolute price elasticity for good B is 1. Which good's quantity demanded is more responsive to a change in price?
A) Good A
B) Good B
C) They are equally responsive.
D) Not enough information is given.
Answer: A
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Using the data in the table above, if the price of a stapler is $5, then there is ________ of staplers, and the quantity of staplers demanded ________ the quantity of staplers supplied
A) a shortage; is greater than B) a surplus; is less than C) a shortage; is less than D) a surplus; is greater than E) neither a surplus nor a shortage; equals
A firm sells 100 . units per week. It charges $15 per unit, the average variable costs are $10, and the average costs are $25 . The firm should
a. Shut-down as the firm is making a loss of $10,00 . per week b. Shut-down as the firm cannot cover the fixed costs c. Continue operating as the firm is covering all the variable costs and some of the fixed costs d. Shut-down because it is cost effective to pay off the remaining fixed costs
Which of the following changes will occur to the market for movie tickets when the cost of electricity to operate the air conditioner rises dramatically.
A . The supply curve will shift out, causing the price to increase and the quantity to decrease. B. The supply curve will shift out, causing the price to decrease and the quantity to increase. C. The supply curve will shift in (up and back), causing the price to decrease and the quantity to increase. D. The supply curve will shift in (up and back), causing the price to increase and the quantity to decrease.
The 3 effects that help explain why the aggregate demand curve is downward sloping
What will be an ideal response?