Resource X has many close substitutes, whereas resource Y has no close substitutes. Other things equal, we would expect:
A. the demand for resource Y to be more elastic than the demand for resource X.
B. resources X and Y to be close substitutes.
C. resource X to be more expensive than resource Y.
D. the demand for resource X to be more elastic than the demand for resource Y.
Answer: D
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The property of money that allows for the settling of debts that mature in the future is
A) store of value. B) liquidity. C) acceptability. D) standard of deferred payment.
If a firm's marginal costs ________ then its ________
A) fall; best-response curve shifts B) rise; forced out of the oligopoly C) rise; output increases D) fall; price falls
Chad is willing to pay $5.00 to get his first cup of morning latté; he is willing to pay $4.50 for a second cup. He buys his first cup from a vendor selling latté for $3.75 per cup. He returns to that vendor later in the morning to find that the vendor has increased her price to $3.90 per cup. Chad buys a second cup. Which of the following statements is correct?
a. Chad's willingness to pay for his second cup of latté was smaller than his willingness to pay for his first cup of latté. b. Chad's consumer surplus on his second cup of latté was larger than his consumer surplus on his first cup of latté. c. Chad is irrational in that he is willing to pay a different price for his second cup of latté than what he is willing to pay for his first cup of latté. d. Chad places a higher value on his second cup of latté than on his first cup of latté.
A concentration ratio
a. measures the percentage of total output supplied by the four largest firms in the industry. b. reflects the level of competition in an industry. c. is related to the control that each firm has over price. d. All of the above are correct.