In the figure above, what is the point price elasticity of demand when price is $80?
A. -0.50
B. -1.00
C. -2.00
D. -1.60
E. -0.75
Answer: C
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A perfectly elastic demand curve for a firm
A. is represented by a vertical line. B. means that with every unit price increase there will be a unit decrease in demand. C. is formulated by P× Q = a constant, for all prices and quantities. D. indicates that any increase in price will eliminate all purchases of its product.
The above figure shows a production possibility frontier for a society with two members, Al and Bruce. If point "a" is the efficient product mix, draw a possible Edgeworth box and indifference curves
What will be an ideal response?
Fresh Air is a large company that repairs residential air conditioners in many homes spread across a state. The company has 50 employees who each have their own repair van. Because the managers of Fresh Air cannot monitor every employee on every repair job, the company sends a satisfaction score card to each customer asking them how pleased they are with the service. If an employee receives a
high satisfaction score, the employee receives a bonus. The bonus policy incentives the employees to do all of the following to earn a high satisfaction score except which one? A) Offer the customers free services or free up-grades on the repairs. B) Stop and take a lunch break on the way to the repair job. C) Perform a good repair. D) Be courteous to the customer
If a regulatory commission wishes to allow a firm to earn a normal rate of return, it should set price equal to: a. marginal revenue
b. marginal cost. c. average total cost. d. average variable cost.