You are the newly appointed sales manager of the Rock Record Company and have been charged with the task of increasing revenues. Your economics consultants tell you that at present price and output levels, price elasticity of demand for your product is less than one. You should:
A. increase prices.
B. cut advertising expenditures to decrease the demand for these records.
C. hold prices constant and increase supply.
D. decrease prices.
Answer: A
You might also like to view...
If a friend of yours keeps cash hidden under the mattress, he is using money as a
A) medium of exchange. B) unit of accounting. C) store of value. D) standard of deferred value.
The type of currency in circulation in the modern U.S. economy is almost entirely
A. commodity money. B. metallic money. C. fiat money. D. silver certificates.
At the profit-maximizing level of production, a perfectly competitive industry will produce an _____ level of production, and a monopolist produces an _____ level of production.
a. efficient; inefficient b. inefficient; efficient c. inefficient; inefficient d. efficient; efficient
A tax system in which the average and marginal tax rates are the same for every level of taxable income and every change in income is an example of
A) regressive taxation. B) proportional taxation. C) progressive taxation. D) premium taxation.