Using the figure above, suppose Starbucks charges $4.50 per cup for its latte. Which of the following is true?
i. At this price, the demand for Starbucks latte is elastic.
ii. If Starbucks lowers the price of its latte, its revenue will decrease.
iii. If Starbucks raises the price of its latte, the demand for it will become less elastic.
A) Only iii
B) Only i
C) Only ii
D) i and ii
E) i and iii
B
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In the figure above, originally the apartment rental market is in short-run and long-run equilibrium with a rent of $600 per month. Then the government imposes a rent ceiling of $500 per month
If the law is strictly enforced, the maximum for which an apartment will rent on the black market is A) less than $600 per month. B) $600 per month. C) $700 per month. D) more than $700 per month.
If there are only three firms in an industry with 50 percent, 40 percent, and 10 percent of the market, respectively, the Herfindahl Index is
a. 40 b. 100 c. 200 d. 33 e. 4,200
The aggregate demand curve is downward sloping because as the price level increase the
A) purchasing power of wealth decreases B) demand for imports decreases C) demand for interest-sensitive expenditures increases D) demand for domestically produced substitute goods increases E) real value of fixed assets increases
A tax on U.S. imports of Chinese-made tires is likely to:
reduce the price of tires for the domestic buyers for tires in the U.S. reduce the volume of imports increase the volume of imports have no effect on the volume of imports