If the supply of oranges is unit elastic, the price elasticity of supply of oranges is
A. 1.0.
B. 0.0.
C. -1.0.
D. -100.0.
Answer: A
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A barrier to entry is
A) the economic term for diseconomies of scale. B) illegal in most markets. C) anything that protects a firm from the arrival of new competitors. D) a factor that increases competition because firms must continue to operate in the market in which they were founded. E) the same as rent seeking.
In the figure above, the shift in the demand curve for U.S. dollars from D0 to D2 could occur when
A) the U.S. interest rate falls. B) the U.S. interest rate rises. C) people expect that the dollar will appreciate. D) foreign interest rates fall.
The inefficiency created by income taxation occurs due to
A) the cost of collecting taxes and making welfare payments. B) motivating welfare recipients to work less. C) motivating income earners to work less. D) All of the above answers are correct.
\Suppose the quantity demanded of steak is 200 million pounds per year when the price is $6 per pound and 400 million pounds per year when the price is $2 per pound. The price elasticity of demand for steak over this range is:
a. elastic. b. inelastic. c. unitary elastic. d. perfectly elastic. e. perfectly inelastic.