Why is it a bad business practice to assume that raising prices will lead to increases in total revenue?
What will be an ideal response?
The reason is that revenue could move in either direction. What is crucial in determining whether it will rise or fall is dependent upon the elasticity of demand at the point where price is increased.
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Generally speaking, income inequality is
A) higher in Europe than in the United States. B) higher in the United States than in most of the developing world. C) extremely high and does not vary much between nations in the developing world. D) higher in the developing world than in the developed world.
The monopolist's supply curve
A) doesn't exist. B) is the region of its marginal cost curve above average cost. C) is identical to the demand curve. D) is the region of its marginal cost curve that lies above the marginal revenue curve.
Economies of scale are also called increasing returns to scale
a. True b. False Indicate whether the statement is true or false
Asking people to indicate their economic values in a survey is an example of what type of economic valuation?
a. Travel cost method b. Contingent valuation c. Hedonic pricing d. Production function valuation e. Avoided cost valuation