The current supply of Rembrandt paintings:
a. is perfectly elastic
b. is elastic.
c. is unit elastic.
d. is perfectly inelastic.
d
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Suppose that when a perfectly competitive firm produces 1,000 units of output, its total variable cost is $1,900. If the marginal cost of producing the 1,000th unit is $1.70, and if the market price of each unit of output is $1.70, then the firm should:
A. shut down. B. increase output. C. raise its price. D. continue to produce 1000 units.
Which would be easier to reverse? For Denmark, which now pegs its national currency to the euro, to choose monetary autonomy and abandon its peg, or for Italy to switch back from the euro to the lira?
A) Italy, because all it has to do is cash euros for lire B) Italy, because it can change over to an electronic payments system C) Denmark, because it would only have to return all the euros in its treasury D) Denmark, because it would not have to change its currency, accounting structure, nor reprint domestic currency
A monopolistically competitive firm influences market price by virtue of its size.
Answer the following statement true (T) or false (F)
In the short-run, nominal wages are sticky due to the existence of both formal and informal agreements. This means that wages decrease slowly in the presence of low unemployment, and increase slowly in the presence of high unemployment.
Indicate whether the statement is true or false.