The most important determinant of the price elasticity of demand for a good is
A) the share of the good in the consumer's budget. B) whether the good is a necessity or a luxury.
C) the definition of the market for a good. D) the availability of substitutes for the good.
D
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Use the figure below to answer the following question.
An increase in quantity supplied caused by a change in price is depicted by a
A. movement from point y to point x. B. shift from S1 to S2. C. movement from point x to point y. D. shift from S2 to S1.
What is the marginal cost of a good?
What will be an ideal response?
From the economist's perspective, "market failures" basically arise when:
A. the market system is unable to adapt to or to accommodate change. B. the quantity demanded for a good or service is greater than the quantity supplied of the good or service. C. demand and supply do not accurately reflect all the benefits and all the costs of production. D. the quantity supplied of a good or service is greater than the quantity demanded for a good or service.
Which statement is true?
A. If the Metropolitan Opera had every opera star in the world under contract, it would be considered a monopoly because it had control over an essential resource in its business. B. There is no way to distinguish between the long run and the short-run if a monopoly is making a profit. C. Until the early 1960s, the National Football League had control of an essential resource, star football players, and was therefore able to maintain its monopoly status until the American Football League started drafting college stars in the early 1960s. D. All of the statements are true.