Use the figure below to answer the following question. 
Assume that price increases from $2 to $10. The price elasticity of supply (based on the midpoint formula) associated with this price change is about
A. 0.25 and supply is inelastic.
B. 1 and supply is unit-elastic.
C. 1.35 and supply is elastic.
D. 4 and supply is elastic.
Answer: A
You might also like to view...
Many younger people eat peanut butter AND jelly, whereas many older people eat peanut butter OR jelly. This suggests that the cross elasticity of demand between peanut butter and jelly is
A) negative for youngsters and positive for oldsters. B) positive for youngsters and negative for oldsters. C) negative for youngsters and zero for oldsters. D) positive for youngsters and zero for oldsters.
The economy will grow from points B to G in Figure 10-3 above over time because
A) per person saving and steady state investment will remain stable at points C and D respectively. B) per person capital will grow, point D to E since per capita savings exceed steady state investment, point C is greater than point D. C) per person capital will grow, point D to E since per capita savings is less than steady state investment, point C is greater than point D. D) per person saving and steady state investment will remain stable at points D and C respectively.
Suppose a bottle of wine produced in France sells for 35 euros. If the exchange rate between euros and dollars is €1 = $1.30, how much will an American pay for the bottle of wine in America?
A. $130.00. B. $26.92. C. $45.50. D. $35.00.
If ATC > P, then a profit-maximizing, monopolistically competitive firms earns ________ economic profits.
A. negative B. positive C. zero D. either positive or negative