Your local grocery store offers a coupon that reduces the price of milk during the coming week. The regular retail price of milk in the store is $3.00 per gallon, and the coupon price is $2.00 per gallon for the next week
If the store maximizes profits and the price elasticity of demand for milk is -2 for coupon users, what is the price elasticity of demand for non-users? A) -0.67
B) -1.0
C) -1.5
D) We do not have enough information to answer the question.
C
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Refer to Figure 2-8. What is the opportunity cost of 100 dozen roses?
A) 0.8 dozen orchids B) 5 dozen orchids C) 40 dozen orchids D) 80 dozen orchids
The kinked demand curve model best reflects
A) mutual interdependence among sellers. B) a game theory approach to price-output decisions. C) price rigidities in oligopolistic markets. D) All of the above
Suppose at the current level of labor used, MRP = $20 and MFC = $20. To maximize profits, the firm should
A) hire more labor. B) reduce the level of labor. C) maintain the current level of labor. D) shut down.
If the current account balance is -$100 billion, the capital and financial account balance is $80 billion, then the official settlements account balance is
A) $20 billion. B) $180 billion. C) -$20 billion. D) -$180 billion. E) 0.