Those with more inelastic demands will bear a larger burden of a tax because they:
A. will switch to other products with a tax.
B. have more buying power.
C. have more income.
D. have fewer substitutes for that good.
Answer: D
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Refer to Figure 16-5. Suppose the firm represented in the diagram decides to use a two-part pricing strategy such that it charges a fixed fee and a per-unit price equal to the monopoly price. What is the profit earned under this pricing scheme?
A) $5,760 B) $6,400 C) $7,680 D) $7,870
The number of firms in a perfectly competitive market:
A. is fixed in the short run. B. is fixed in the long run. C. varies in the short run. D. is the same at all possible long-run equilibria.
A decrease in AS will trigger less inflation under which of the following conditions?
a. AD is relatively steep. b. AD is relatively flat. c. AS is relatively steep. d. AS is relatively flat.
Historically, revolutionary inventions and innovations have come from
A. large established companies. B. individuals and small new firms. C. firms with large research and development programs. D. government-sponsored entities.