Firm A producing one good acquires another firm B producing another good. Price elasticity of demand for Firm A's good is -1.8 and Firm's B is -1.8 . Holding other things constant and assuming both goods are substitutes, the acquiring firm should
a. Raise prices on both goods with a larger increase in Firm A's good
b. Raise prices on both goods with a larger increase in Firm B's good
c. Raise prices on both goods by the same amount
d. Lower prices on both goods
c
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The price of a firm's product is $6 and the firm faces a constant marginal cost of $4 that is equal to its (constant) average total cost. If the firm does not sell a unit of its product on the day it was produced, it is sold in a secondary market for a price of $3. If the firm does not sell a unit of its product on the day it was produced, there is a ________ of ________ per unit not sold.
A) loss; $2 B) loss; $1 C) profit; $1 D) profit; $2
Fixed exchange rates serve as a constraint on inflationary government policies
a. True b. False Indicate whether the statement is true or false
The economic theory of supply assumes that
What will be an ideal response?
A trade surplus occurs when a country's exports exceed that country's imports.
Answer the following statement true (T) or false (F)