The market demand curve for a given product may be downward sloping even if no person in that market has a downward sloping demand curve
Indicate whether the statement is true or false
True
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The above figure shows the U.S. market for flip-flops. With international trade, U.S. consumers buy ________ flip-flops and U.S. producers produce ________ flip-flops
A) 500,000; 500,000 B) 300,000; 700,000 C) 700,000; 500,000 D) 700,000; 300,000 E) 500,000; 300,000
If there are barriers to entry into a market, it is possible for the existing firm(s) to earn positive economic profits. All of the following explain this except:
A) new firms cannot enter to take advantage of the profits. B) resource immobility. C) it is possible for a firm in this situation to charge any price it wants and thus preclude anyone else from entering. D) competition does not erode profits the way it would under perfect competition.
The income elasticity for most staple foods, such as wheat, is known to be between zero and one
a. As incomes rise over time, what will happen to the demand for wheat? b. What will happen to the quantity of wheat purchased by consumers? c. What will happen to the percentage of their budgets that consumers spend on wheat? d. All other things equal, are farmers likely to be relatively better off or relatively worse off in periods of rising incomes?
Why is a monopoly inefficient?
What will be an ideal response?