When marginal revenue is zero, demand will be:
A. inelastic.
B. unit elastic.
C. elastic.
D. There is not sufficient information to classify the elasticity of demand.
Answer: B
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For an intertemporal budget constraint concerning saving for retirement, the choice is between past and future___________________.
a. salary b. consumption c. health d. working units
A pest attack destroys half of the California navel orange crop. Simultaneously, the price of kiwi fruit, a substitute for navel oranges, falls. How would you expect these two events to affect the equilibrium in the California navel orange market?
a. The demand for navel oranges would decrease but the supply would remain unchanged, resulting in a lower market equilibrium price and quantity. b. The supply would decrease and the demand would increase, resulting in a higher market equilibrium price and an indeterminate change in market equilibrium quantity. c. Both supply and demand would decrease, resulting in a decrease in equilibrium quantity and an indeterminate change in price. d. Both supply and demand would increase, resulting in an increase in equilibrium quantity and an indeterminate change in price.
Markets fail to maximize total surplus when:
A. society's choices impose costs or benefits on other societies. B. individual choices impose costs or benefits on others. C. when all costs and benefits are received by participants in transactions. D. producer surplus is not exactly equal to consumer surplus.
Consider the following figure that shows the demand and the cost curves of a perfectly competitive firm. The firm will earn zero economic profit _____. ?
a. ?at a price of P3 b. ?at a price between P1 and P2 c. ?at a price of P1 d. ?at a price above P1 e. ?at a price of P2