Suppose the demand curve for a product is represented by a typical downward-sloping curve. Now suppose the demand for this product increases. Which of the following statements accurately predicts the resulting increase in price?
A) The more elastic the supply curve, the greater the price increase.
B) The increase in price is not affected by the elasticity of the supply curve.
C) The more elastic the supply curve, the smaller the price increase.
D) There will be no increase in price if the supply curve is perfectly inelastic.
C
You might also like to view...
A central bank that is buying its own currency might be trying to ________
A) weaken its currency B) increase the domestic money supply C) reduce domestic interest rates D) reduce inflation
If two firms playing Cournot are identical with decreasing average costs, how should the firms divide production to maximize joint profits?
What will be an ideal response?
Production Possibility Schedules for Two South Pacific Island NationsKiribatiTuvaluMangoesCoconutsMangoesCoconuts30001,20002004008001,2001008004002,40001,20003,600In Kiribati, the opportunity cost of producing one mango (in terms of coconuts) is:
A. 4. B. 1/4. C. 400. D. 0.
The PIA is generated with a formula such that
A. high-income earners receive the same as low-income earners. B. high-income earners receive less than low-income earners. C. higher-income earners receive more money but a lower proportion of their AIME than lower-income. D. higher-income earners receive the same proportion of AIMA as low-income earners.