A "war on drugs" is waged, and, as a result, a larger quantity of drugs flowing into the United States is seized and more drug traffickers are arrested. If demand for drugs is relatively elastic, one would expect the total expenditure on drugs to:
a. decrease
b. increase.
c. stay constant.
d. There is not enough information available to make a determination.
a
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People who give erroneous explanations of how they themselves perform a particular task, such as tying their shoelaces or setting prices,
A) cannot be performing the task successfully. B) may nonetheless perform the task successfully. C) must be lying. D) would necessarily perform the task more successfully if they understood it correctly.
A firm's average total cost is $100, its average variable cost is $90, and its total fixed cost is $1,000. Its output is
A) less than 70 units. B) between 70 and 120 units. C) between 120 and 170 units. D) more than 170 units.
Explain the relationship between price elasticity of demand and total revenue
What will be an ideal response?
Economists claim that measuring society's welfare as CS + PS
A) is inappropriate since ultimately everyone is a consumer. B) is valid only when the same person could be either a consumer or a producer. C) treats the gains to consumers and producers equally. D) is not commonly accepted.