Assume that Pyrotex Inc. estimates the demand for its fireworks to be linear. If the current price charged by Pyrotex is such that the elasticity of demand is equal to 2.5, which of the following statements is true?
A. Pyrotex cannot increase its profits by changing the price of fireworks.
B. Pyrotex will surely increase its profits by decreasing the price of fireworks.
C. Pyrotex will surely increase its profits by increasing the price of fireworks.
D. Not enough information is provided to determine whether Pyrotex is currently maximizing its profits.
Answer: D
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Which oligopoly model results in firms successively undercutting their rivals' prices until the competitive outcome is reached?
a. The contestable market model. b. The Cournot model of oligopoly. c. The Bertrand model of oligopoly. d. The monopolistic competition model.
________ is the ability to produce more of a good or service than competitors when using the same amount of resources
A) Comparative advantage B) Trade autarky C) Trade superiority D) Absolute advantage
Which statement is true?
A. The U.S. is both the world's leading creditor nation and the leading debtor nation. B. The U.S. is neither the world's leading creditor nation nor the world's leading debtor nation. C. The U.S. is the world's leading creditor nation and not the world's leading debtor nation. D. The U.S. is the world's leading debtor nation and not the world's leading creditor nation.
Factors of production are:
A.) the laws that regulate manufacturers. B.) the technological innovations available to companies. C.) the resources used to create output. D.) the waste left over after goods are produced.