Assume there is a decrease in the number of substitutes for a good produced by a profit-maximizing price-setting firm. All else constant, this would cause the firm's ability to markup price above average cost to:
A) decrease.
B) stay the same.
C) increase.
D) cannot be determined with the information given.
C
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Which of the following would likely result as a consequence of rent controls?
A) a reduction in the rate of construction of rental housing units B) unimproved buildings and apartment complexes C) limits on tenant mobility D) All of the above are correct.
Refer to the above table. Suppose the price of the good sold is $4 and the marginal factor cost of labor is $600, how many units of labor will the firm hire?
A) 4 B) 5 C) 6 D) 3
When grocery stores issue special discount membership cards for shoppers effectively offering different prices based on quantities consumed, this is an example of
A) price discrimination. B) price differentiation. C) product differentiation. D) patent protection.
If a price ceiling of $1.50 per gallon is imposed on gasoline, and the market equilibrium price is $2, then the price ceiling is a binding constraint on the market
a. True b. False Indicate whether the statement is true or false