If the supply elasticity for corn is 2.0, then a 20% increase in market price will result in a change in quantity supplied of
A. -10%
B. +4%
C. +20%
D. +40%
Ans: D. +40%
You might also like to view...
When the demand curve is vertical and the supply curve is upward sloping,:
a. a rise in the input price that increases marginal cost by $1, decreases the firm's profit by $1. b. a drop in the input price that lowers the marginal cost by $1, doubles the firm's profit. c. a drop in the input price that lowers the marginal cost by $1, decreases the output price by $1. d. a rise in the input price that increases the marginal cost by $1, doubles the output price.
A monopolistically competitive firm that is profitable in the short run will face competition that will eventually eliminate the firm's profits in the long run. But the firm can stave off competition and continue to earn economic profits if
A) it can lobby the government to establish a price floor for its product. B) it can find new ways to differentiate its product. C) it can move to another country where there is less competition. D) it can successfully sue its competitors for copyright infringement.
The theory of adaptive expectations points out that when a shift in aggregate demand occurs, people and businesses will rationally expect its impact on output and employment to be temporary and its impact on the price level to be permanent
a. True b. False Indicate whether the statement is true or false
Suppose the demand for a product is lnQxd = 10 ? ln Px, then product x is:
A. inelastic. B. elastic. C. unitary elastic. D. Cannot be determined without more information.