Elasticity is:
A) the sum of the percentage change in two variables.
B) the difference of the percentage change in two variables.
C) the product of the percentage change in two variables.
D) the ratio of the percentage change in two variables.
D
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Answer the following statement(s) true (T) or false (F)
1. Social welfare consequences are ambiguous when two or more manufacturers merge to take advantage of economies of scale. 2. When a monopoly supplier acquires a monopoly manufacturer, the vertical merger intensifies the supplier's use of monopoly power over the manufacturer. 3. A buy-out is more likely to delay a rival's reemergence than is predatory pricing. 4. Economic analysis suggests that resale price maintenance is primarily used by manufacturers to keep prices artificially high. 5. A firm has the incentive to cheat on a cartel agreement only when it fears that other cartel members will also cheat.
If average labor productivity decreases, then the same number of employed workers will always produce:
A. more total output. B. less output per person. C. less total output. D. more output per person.
Suppose your firm is operating in a perfectly competitive market, and that the minimum average variable cost of producing your good is $13. If the price of the good is $15, your firm should:
A. supply the amount of the good where the marginal cost of production is equal to $15. B. not produce anything since the price is above the minimum of average variable cost. C. not consider price when determining the amount to sell. D. not do any of these.
When a credit card company offers different services with its card, like travel insurance for air travel tickets purchased with the credit card or product insurance for items purchased with the card, the credit card company is trying to:
A. create a barrier to entry for competing firms. B. create a perfectly competitive market in which to sell its credit card. C. differentiate its credit card from those offered by other companies. D. shift the demand curve for competing firms to the right.