Department stores are monopolistically competitive because stores differ in the amount of customer service they provide.
Answer the following statement true (T) or false (F)
True
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Suppose the demand for milk is relatively inelastic. What happens to sales revenue if the government imposes a price floor above the free-market equilibrium price in the market for milk?
A) Sales revenue remains unchanged. B) Sales revenue rises. C) Sales revenue falls. D) It cannot be determined without information on prices.
When the supply elasticity of a product is 2.5, a 10 percent decrease in price will _____ the quantity supplied of the product by _____ percent
a. increase; 25 b. decrease; 25 c. increase; 2.5 d. decrease; 2.5 e. decrease; 4
DeShawn's Detailing is a service that details cars at the customers' homes or places of work. DeShawn's cost for a basic detailing package is $40, and he charges $75 for this service. For a total price of $90, DeShawn will also detail the car's engine, a
service that adds an additional $20 to the total cost of the package. Should DeShawn continue to offer the engine detailing service? A) Yes, he still makes a profit by selling the engine detailing service with the basic detailing package. B) yes, but only if he raises the price of the basic detailing package C) No, his marginal benefit is less than his marginal cost. D) More information is needed for DeShawn to make this decision.
What is the opportunity cost of producing capital goods such as a new road?
What will be an ideal response?