The price elasticity of demand for a rental home in Luxury Resorts in the summer is 1.40 and is 2.60 in the spring. If Luxury Resorts faces a constant marginal cost of $600 per home rental, what is the profit-maximizing off-peak load price to charge in the spring?
A) $975 B) $2,100 C) $575 D) $850
A) $975
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Why are there significant time lags in monetary policy?
a. Financial markets are inefficient and information takes several months to impact them. b. Changes in monetary policy only affect future projects such as factories, not current ones. c. Interest rates takes several months to change after a change in money supply. d. Interest rates are fixed and it takes several months to change laws to have the targets amended. e. Because of the Fed's relative inability to convince Congress about the necessity of a particular monetary policy.
The United States is one of the most marketized economies in the world
a. True b. False Indicate whether the statement is true or false
Figure 10-2
At which point in is the economy at long-run equilibrium?
a.
J
b.
F
c.
G
d.
H
In the 1998 case, Microsoft argued that the low price they charged for Windows showed that ______.
a. they were engaged in predatory pricing b. their market power was limited c. they were too big to fail d. their competitors’ prices were discriminatory