Suppose that Mimi plays golf 5 times per month when the price is $40 and 4 times per month when the price is $50. What is the price elasticity of Mimi’s demand curve?
a. 0.1
b. 0.8
c. 1.0
d. 10.0
c. 1.0
The price elasticity of Mimi’s demand curve is 1.0.
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A. completely attained. B. largely attained. C. largely unattained. D. completely unattained.
When we calculate the price elasticity of demand, we use percentages of the average price and the average quantity in order to get the same value for the elasticity regardless of whether the price falls or rises
Indicate whether the statement is true or false
If the marginal product of labor is less than the nominal wage divided by the price of output, a firm that wishes to maximize profits will
A) hire more labor. B) lay off workers. C) maintain its current level of workers. D) raise the real wage.