If the price elasticity of supply is 3, supply is:
A. unaffected by price changes.
B. inelastic.
C. unit elastic.
D. elastic.
Answer: D
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In the above figure, if the firm increases its output from Q2 to Q3, it will
A) reduce its marginal revenue. B) increase its marginal revenue. C) decrease its profit. D) increase its profit.
Refer to the table below. If the cost per unit of advertising is constant at $325, what is the level of advertising per week that maximizes the industry joint profit?
Suppose the egg industry is made up of only the three farms above; Happy Chickens, Special Chickens, and Superior Chickens.
A) 1
B) 2
C) 3
D) 4
Are we really rational consumers? If so, how do you explain the fact that every Thanksgiving many of us eat until we get sick! The answer must be that
a. the negative utility associated with being sick is greater than the positive utility of getting sick b. at the time of the eating, the utility of the turkey and stuffing minus the utility of the anticipated after-eating discomfort is still positive c. the utility of the turkey and stuffing at the time of eating minus the utility of the after-eating discomfort felt after the meal was eaten is still negative d. the total utility of eating the meal far outweighs the marginal utility of the discomfort felt after the meal e. the marginal utility of eating the meal far outweighs the total utility of the discomfort felt after the meal
If duopolists colluded but then stopped colluding,
a. price and quantity would rise. b. price would rise and quantity would fall. c. price would fall and quantity would rise d. price and quantity would fall.