In California, the price elasticity for vanity license plates is .5 and their price is $78. California is:
A. maximizing revenue since elasticity is less than 1 and revenue will decrease after a price increase when demand is inelastic.
B. maximizing revenue since elasticity is less than 1 and revenue will increase after a price increase when demand is inelastic.
C. not maximizing revenue since elasticity is less than 1 and revenue will decrease after a price increase when demand is inelastic.
D. not maximizing revenue since elasticity is less than 1 and revenue will increase after a price increase when demand is inelastic.
Answer: D
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Albert's Pretzel Baking Company used to have four workers who were each in charge of making their own pretzels from start to finish
Now, one worker mixes the dough, another shapes it, the third puts the unbaked pretzels into the oven and the fourth removes the finished product. Output has doubled. This is an example of A) neutral technical change. B) labor-saving technical change. C) an organizational innovation. D) economies of scale.
Which of the following is the best example of an investment in human capital?
a. on-the-job training received by an apprentice electrician b. an increase in the number of hours worked per week by a worker in an unskilled laboring job c. the purchase of company stock by a worker d. payments into a retirement pension plan by a skilled laborer
Which of the following is counted in GDP?
A) the trading of 100 shares of Microsoft stock B) the services of a real estate broker C) government transfer payments D) the sale of a used car E) none of the above
Which of the following statements is correct?
A. The pure monopolist will maximize profit by producing at that point on the demand curve where elasticity is zero. B. In seeking the profit-maximizing output, the pure monopolist underallocates resources to its production. C. The pure monopolist maximizes profits by producing that output at which the differential between price and average cost is the greatest. D. Purely monopolistic sellers earn only normal profits in the long run.