If the demand faced by a firm is elastic, selling one less unit of output will
a. increase revenue.
b. decrease revenue.
c. keep revenues constant.
d. decrease price.
b
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Use the following graph of the demand for coffee to answer the question below.
Refer to the three demand curves for coffee. Which of the following would shift the demand for coffee from D1 to D3?
A. a decrease in the price of coffee B. a decrease in the number of buyers of coffee C. an expected increase in the price of coffee in the future D. an increase in the number of buyers of coffee
Which of the following would create a natural monopoly?
A) ownership of all the available units of a necessary input B) an exclusive right granted to supply a good or service C) requirement of a government license before the firm can sell the good or service D) technology enabling a single firm to produce at a lower average total cost than two or more firms E) a patent granted the producer of the good or service
The equation total production = total income = total expenditure is called
A) the goods—market equilibrium condition. B) the total identity. C) the fundamental identity of national income accounting. D) Say's Law.
In a particular production process, if the quantities of all inputs used are increased by 60%, then the quantity of output increases by 60% as well. This means that
a. the production process cannot be enhanced by technological advances. b. no mathematical representation of the relevant production function can be formulated. c. the relevant production function has the limits-to-growth property. d. the relevant production function has constant-returns-to-scale.