If a revenue-maximizing firm is told that the price elasticity of demand is equal to one, it should:
a. raise prices 1 percent.
b. lower prices 1 percent.
c. raise prices until the elasticity becomes very high.
d. keep the price where it is.
e. lower prices until the elasticity becomes very high.
d
You might also like to view...
The Fed can attempt to decrease the federal funds rate by
A) lowering the reserve requirement, which increases the money supply. B) lowering the reserve requirement, which decreases the money supply. C) raising the reserve requirement, which increases the money supply. D) raising the reserve requirement, which decreases the money supply.
Refer to Figure 2-1. ________ is (are) unattainable with current resources
A) Point A B) Point B C) Point C D) Points A and C
The above figure shows a graph of the market for pizzas in a large town. No pizzas will be supplied unless the price is above
A) $0. B) $5. C) $12. D) $14.
When comparing the percentage of income (or expenditure) of the lowest and highest 10 percent of the population,
a. South Africa has a more equal income distribution than the United States. b. South Africa has a more equal income distribution than Japan. c. Japan has a more equal income distribution than the United States. d. Mexico has a more equal income distribution than Germany.