The major economic problem with recent farm policies is that they provide price and income subsidies that:
A. Are insufficient to keep farmers producing
B. Increase the demand for farm products
C. Slow the exodus of resources from agriculture
D. Limit production to the most profitable products
C. Slow the exodus of resources from agriculture
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Explain how the market for gasoline would react to this price ceiling if a global shortage of oil sent the equilibrium price of gasoline to $3.50 a gal-lon. Would the U.S. gasoline market be efficient?
What will be an ideal response?
Suppose the price of movies seen at a theater rises from $12 per couple to $20 per couple. The theater manager observes that the rise in price causes attendance at a given movie to fall from 300 persons to 200 persons
What is the arc price elasticity of demand for movies? A) 0.5 B) 0.8 C) 1.0 D) 1.2
Economies of scope are present when a bank also sells insurance and provides brokerage services for stocks and bonds.
Answer the following statement true (T) or false (F)
The purpose of randomized pricing is to reduce:
A. both customer and competitor information about price. B. competitor price information only. C. the firm's pricing inflexibility. D. consumer price information only.