At the midpoint of a straight-line demand curve, the price elasticity of demand is:
A. less than one.
B. zero.
C. greater than one.
D. equal to one.
Answer: D
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Article 102 of the Treaty on the Functioning of the European Union (TFEU) prohibits a dominant firm from doing all of the following except which one?
A) placing trading partners at a competitive disadvantage by practicing price discrimination B) charging an unfair price C) limiting or controlling production in markets through market division D) buying at a price that is unfairly low
William and Harry each own a rock quarry, both of which are located in different parts of Atlanta . They have each been in business exactly the same length of time. Although their product seems identical, and neither advertises, William earns much larger profits. Can you use the theory of location rent to explain this outcome?
Suppose Katy Lucus maximized her total utility by buying different quantities of a variety of goods. Now suppose the price of one good rises. She then buys less of that good because the
a. MU/P of that good falls below the MU/P of other goods b. MU/P of that good rises above the MU/P of other goods c. marginal utility of that good diminishes d. total utility of that good diminishes e. marginal utility of that good rises
One difference between the long run and the short run in a perfectly competitive industry is that:
A. firms necessarily earn zero economic profit in the long run but may earn positive or negative economic profit in the short run. B. economic profit in the short run is always greater than it is in the long run. C. firms necessarily earn positive economic profit in the long run but may earn positive or negative economic profit in the short run. D. economic profit in the long run is always greater than it is in the short run.