Brand loyalty usually makes the demand curve for a product
A. Unitary elastic.
B. Less price-elastic.
C. More price-elastic.
D. More income-elastic.
Answer: B
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When current growth builds on past growth, growth is:
A) logarithmic. B) exponential. C) linear. D) negative.
Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and S2 (point B)
If there is an increase in number of companies producing motorcycles and a decrease in income (assume motorcycles are a normal good), the equilibrium could move to which point? A) A B) B C) C D) E
Assume the production technology changes for a good that is currently produced in a perfectly competitive market
In particular, the new technology is such that the marginal costs of production for a single firm decline over the entire range of the demand curve for the good in question. How would this affect the number of firms that operate in this market? Explain.
Suppose a monopolistically competitive industry evolved into a perfectly competitive industry. Which of the following statements is correct?
A) The industry would produce more output and charge a lower price after the change. B) The industry would produce at decreasing returns to scale. C) Elasticity of demand for the firm's product would remain the same after this change occurred. D) This industry would produce the same level of output at lower prices in the long run than before the change.