When the price of baseballs decreases by 15 percent, the quantity demanded increases by 25 percent. Which of the following does this example show?
a. total revenue decrease for an elastic price demand
b. total revenue increase for an elastic price demand
c. total revenue decrease for an inelastic price demand
d. total revenue increase for an inelastic price demand
b. total revenue increase for an elastic price demand
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The only way a consumer can optimize at a corner of her budget is if at least one of the goods is not essential.
Answer the following statement true (T) or false (F)
Which of the following is true?
A) If consumption of a good gives rise to a positive externality, it can be internalized by taxing the producers of the good. B) If production of a good gives rise to a negative externality, it can be internalized by taxing the producers of the good. C) If production of a good gives rise to a positive externality, it can be internalized by taxing the consumers of the good. D) If consumption of a good gives rise to a negative externality, it can be internalized by subsidizing the purchase of the good.
The four largest firms in an industry account for the following value of industry sales: 12 percent, 8 percent, 5 percent and 4 percent. Calculate the four-firm concentration ratio. Would this industry be regarded as competitive or concentrated?
What will be an ideal response?
Farmers can plant either corn or soybeans in their fields. Which of the following would cause the supply of soybeans to increase?
A) an increase in the demand for corn B) an increase in the price of soybeans C) a decrease in the price of corn D) an increase in the price of soybean seeds