If a binding price ceiling is imposed on the baby formula market, then
a. the quantity of baby formula demanded will increase.
b. the quantity of baby formula supplied will decrease.
c. a shortage of baby formula will develop.
d. All of the above are correct.
d
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When will setting a relatively high entry fee and a low competitive price be the best strategy for a two-part tariff monopolist?
a. When the customers are nearly identical. b. When the customers have inelastic demand for the product. c. When the customers place a relatively low value on their time. d. When the customers can be separated into a number of diverse groups.
Yoyo's Frozen Yogurt, Inc is thinking of building a new warehouse. They believe that this will give them $50,000 of additional revenue at the end of one year, $60,000 additional revenue at the end of two years, and $70,000 in additional revenue at the end of three years. If the interest rate is 5 percent, Yoyo would be willing to pay
a. $140,000, but not $150,000. b. $150,000, but not $160,000. c. $160,000, but not $170,000. d. $170,000, but not $180,000.
If demand elasticity of airline tickets is 3, what percentage change in quantity would the airlines expect from a 10% increase in price?
What will be an ideal response?
What is opportunity cost?
What will be an ideal response?