Consider a single-price monopolist that is in equilibrium at output level Q* and price P*. If the government imposes a new tax on the firm of $25 per unit of output, then
a. output and price will remain at Q and P
b. output will fall and price will rise by $25
c. output will fall and price will fall by less than $25
d. output will rise and price will fall by $25
e. output will fall and the price will rise by less than $25
.A
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Referring to a production possibilities curve and the goods being compared, depict the economic event. The SARS epidemic spreads rapidly throughout Toronto, Canada claiming millions of lives (capital vs. consumer goods).
A. A movement from a point inside the curve to a point on the curve B. A movement from a point on the curve to a point inside the curve C. A shift in the entire curve to the right (outward) D. A shift in the entire curve to the left (inward)
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
A commercial bakery makes white bread and wheat bread. Therefore, a decrease in the market price of white bread tends to
A) increase the demand for wheat bread. B) increase the demand for white bread. C) increase the baker's cost of making wheat bread. D) decrease the baker's cost of making wheat bread.
Chinese restaurants that charge one price per customer for their buffet is an example of
a. Individual pricing b. Pure bundling c. Mixed Bundling d. None of the above