"Unit elasticity of demand can be found everywhere along a straight-line demand curve with a slope of -1." Do you agree or disagree? Explain
What will be an ideal response?
Disagree. A vertical demand curve implies perfectly inelastic demand and a horizontal demand curve implies perfectly elastic demand. However, unit elasticity of demand can only be can found in the mid-range of a straight-line demand curve with a slope of -1, but not anywhere else along it.
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Which of the following do economists consider to be capital?
A. a pair of stockings B. a share of IBM stock C. a construction crane D. a savings account
An externality can be a
A) cost or a benefit. B) benefit but not a cost. C) cost but not a benefit. D) marginal cost but not a total cost.
In which statement(s) is "supply" used correctly? (I) "An increase in the price of flour will increase the supply of flour." (II) "As the cost of producing flour rises, the supply of flour will tend to fall."
a. in both statements I and II b. in statement I only c. in statement II only d. in neither statements I nor II
If the firm were a perfect competitor in the long run, how much would its output be?
