Gloria works for a museum in a large city with many other museums. Her boss proposes that the museum should raise the price of admission to increase revenues. Gloria was a good student in her economics principles course. How should she advise her boss?
What will be an ideal response?
If there are many museums in the city demand for museum admissions is likely to be elastic. If Gloria's museum raises the price of admission, this will reduce revenues. She should advise her boss against a price increase.
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If intended investment increases by $50, and the MPC remains unchanged at 0.75, then
a. the economy is in equilibrium at both levels of intended investment because MPC remains unchanged b. national income remains unchanged regardless of the change in intended investment c. MPS must increase from 0.25 to 0.75 d. national income increases by $200 e. we know this couldn't happen because the MPC cannot remain unchanged when intended investment changes
If there are strong economies of scale and scope, then society
a. will not be able to prevent overt collusion. b. will benefit from establishing a cartel. c. cannot benefit from regulation of a natural monopoly. d. will not be able to preserve free competition.
The domestic demand and supply for sugar are Qd = 40,000 ? 200P and QSD = 10,000 + 300P. The foreign supply is QSF = 20,000 + 100P. Suppose an import quota of 5,000 is imposed in the domestic market. What will be the new market price of sugar?
A. 30 B. 40 C. 20 D. 50
What is the key difference between the short-run and long-run in terms of elasticity of supply?
A. Fixed productive capacity B. Labor changes C. No changes can be made to capital or labor D. No difference