At a price of $4 per unit, Gadgets Inc. is willing to supply 20,000 gadgets, while United Gadgets is willing to supply 10,000 gadgets. If the price were to rise to $8 per unit, their respective quantities supplied would rise to 45,000 and 25,000. If these are the only two firms supplying gadgets, what is the elasticity of supply in the market for gadgets?
A. 0.80
B. 0.833
C. 1.0
D. 1.2
Answer: D
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Which of the following industries was not deregulated during the 1970s and 1980s?
a. airline industry b. auto industry c. banking industry d. trucking industry
In response to an unanticipated easing of monetary policy, the price level ________ at first, then ________ after a year
A) rises; returns most of the way to its original value B) falls; returns most of the way to its original value C) remains roughly unchanged; begins to rise D) remains roughly unchanged; begins to fall
Consumer income changes can shift market demand
a. True b. False Indicate whether the statement is true or false
Exhibit 8-7 Monopolist
?
According to the information provided in Exhibit 8-7, if the Rudd Ice Company is a monopoly and is currently charging a price of $6, what would you advise Rudd to do?
A. Stay where he is currently operating because he is charging the profit maximizing price. B. Increase price and decrease output. C. Decrease price and increase output. D. Increase output and hold price constant.