The price elasticity of demand for a good is 0.2 . A 10 percent rise in the price will _______ the total revenue from sales of the good
A. decrease
B. increase
C. decrease the quantity sold with no change in
D. not change
B The total revenue test on page 121 shows that a rise in the price increases the total revenue if demand is inelastic.
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A change in the full-employment quantity of labor ________ the short-run aggregate supply curve and ________ the long-run aggregate supply curve
A) shifts; shifts B) shifts; does not shift C) does not shift; shifts D) does not shift; does not shift
If a tax is imposed on buyers in a market in which supply is perfectly inelastic, the
A) buyers pay the entire tax. B) sellers pay the entire tax. C) buyers and the sellers both pay a portion of the tax. D) neither the buyers nor the sellers pay the tax.
Suppose the monopolist only sold the goods separately. What price will the monopolist charge for Good 2 to maximize revenues for good 2?
a. $2,300 b. $2,800 c. $1,200 d. $1,700
The basic problem of a shared monopoly from the point of view of those involved is that
A. the shared output is too high for the high price to be maintained. B. revenue is lower than in the other oligopoly models. C. collusive agreements are difficult to sustain. D. profits are lower than in the other oligopoly models.