A compensated demand curve contains no
a. income effects.
b. substitution effects.
c. price elasticity.
d. income compensation.
a. income effects.
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If the price of salt increases and the quantity demanded does not change, then
A) the price elasticity of demand is equal to zero. B) demand is perfectly inelastic. C) the demand curve for salt is horizontal. D) Both answers A and B are correct.
In the short run, a perfectly competitive firm's economic profits
A) must equal zero, that is, the firm earns a normal profit. B) must be positive. C) might be positive, negative (an economic loss), or zero (a normal profit). D) must be negative, that is the firm must incur an economic loss.
As of October 2012, approximately what portion of U.S. currency is held outside of the United States?
A) 1/10 B) 1/3 C) 1/2 D) 2/3
Figure 7-13
Figure 7-13 shows the average total cost curves of four firms that produce milk. Some of the dairies are more productive. AR = P is the long-run price of milk. How many of these dairies will remain in the industry in the long run?
A. All of them B. Only 2 C. Only 3 D. Cannot determine with information given