If a firm in a competitive market doubles its number of units sold, total revenue for the firm will
a. more than double.
b. double.
c. increase but by less than double.
d. may increase or decrease depending on the price elasticity of demand.
b
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If the cross elasticity of demand between peanut butter and milk is -1.11, then are peanut butter and milk substitutes or complements?
What will be an ideal response?
Price elasticity of demand and price elasticity of supply are both influenced by
a. the availability of close substitutes for the product b. the proportion of the consumer's budget spend on the product c. the length of the adjustment period considered d. technological conditions such as the additional costs of increasing production e. none of the above
What would be the most likely reason for a government to introduce a tax increase?
a. impeding a monopoly b. reducing unemployment c. lowering interest rates d. overcoming inflation
After a price decrease for good X, the new consumer equilibrium level of good X will be:
A. lower than before the price change. B. indeterminate without more information. C. the same as before the price change. D. higher than before the price change.