Suppose a local bookstore notices that a 2 percent increase in book prices leads to a 2 percent decrease in the number of books sold. Which of the following is true?
a. Demand for books is price elastic.
b. The store's sales revenue did not change.
c. Demand for books is price inelastic.
d. Demand for books is perfectly inelastic.
e. The bookstore could increase revenue by further lowering prices.
B
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An increase in government spending increases the supply of money in our economy
Indicate whether the statement is true or false
Given implicit or explicit resource price agreements, if the actual price level is below the expected price level, the: a. economy will move rightward along the short-run aggregate supply curve. b. economy will move leftward along the short-run aggregate supply curve. c. short-run aggregate supply curve will shift to the left
d. long-run aggregate supply curve will become steeper. e. short-run aggregate supply curve will become flatter.
Suppose a firm wants to build a new factory that would add pollution to an already polluted area. Under an offset program, the firm must:
A. install scrubbers and other government-mandated equipment. B. purchase pollution permits from the government. C. reduce or eliminate an old pollution source in the area. D. pay a tax which depends on the amount of pollution created.
At two points on an indifference curve,
a. the bundles of goods yield the consumer the same satisfaction. b. the consumer has the same income. c. the bundles of goods cost the consumer the same amount. d. the consumer has the same marginal rate of substitution.