The price elasticity of demand for a variable input will be more elastic in all the following cases EXCEPT
A) the greater the price elasticity of demand for the final product.
B) the easier it is for a particular variable input to be substituted for by other inputs.
C) the larger the proportion of total costs accounted for by a particular variable input.
D) the shorter the time period being considered.
Answer: D
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If the firm’s marginal physical product is 8, and its handicrafts sell for $70, when a unit of labor costs $150, the firm is operating
A. short of an optimal input point. B. at the optimum input point. C. beyond the optimum input point. D. There isn’t enough information to determine if the input point is optimal.
Conglomerate mergers are designed to increase market share
Indicate whether the statement is true or false
Suppose the official unemployment rate is 10 percent. We can conclude without question that:
A. the same 10 percent of the people in the economy were out of work for the entire year. B. one of every 10 people in the civilian labor force is currently unemployed. C. 10 percent of the people in the civilian labor force were out of work for 10 percent of the entire year. D. every person in the civilian labor force was out of work for 10 percent of the year.
Refer to the above table. The table represents information on the costs for Ajax Corporation. Ajax operates in a perfectly competitive market and the price of the product is $10. What does profit equal when quantity equals 4?
A. $10 B. $4 C. $40 D. $8