If the absolute price elasticity of demand is 2.5, a 10 percent increase in the price will cause
A) the quantity demanded to decrease by 2.5 percent.
B) the quantity demanded to decrease by 25 percent.
C) the quantity demanded to decrease by 4 percent.
D) the quantity demanded to decrease by 40 percent.
Answer: B
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If Pastry Paradise takes over Sweet Tooth, at what level of production would it be indifferent between which technology is used
a. 500 b. 750 c. 250 d. 125
Sam quits his job as an airline pilot and opens his own pilot training school. He was earning $40,000 as a pilot. He withdraws $10,000 from his savings where he was earning 6 percent interest and uses the money in his new business. He uses a building he owns as a hangar that he could have rented out for $5,000 per year. He rents a computer for $1,200, buys office supplies for $500, rents an
airplane for $6,000 . pays $1,300 for fuel and maintenance, and hires one worker for $30,000 . Sam's total revenue from pilot training classes equaled $90,400 . Sam's implicit costs for this year are equal to a. $84,400 b. $39,000 c. $55,000 d. $45,600 e. $40,000
A country undertakes a devaluation in order to:
A. increase its net exports. B. decrease its net exports. C. raise the value at which its currency is pegged. D. move to a flexible exchange rate system.
Refer to the scenario above. A firm producing Good Y will continue production in the short run if total revenue exceeds ________
A) $25,000 B) $60,000 C) $85,000 D) $35,000