Often, gas stations only a few miles apart differ in price by as much as $0.10 per gallon. The most likely explanation for this kind of price discrimination is that:
A. the cost of providing gasoline is the same in each community.
B. the elasticity of demand is the same in each community.
C. consumers in some communities have a more elastic demand for gasoline than do consumers in nearby communities.
D. gasoline purchased at one station is a perfect substitute for gasoline purchased at a station a few miles away.
Answer: C
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If the price of orange juice rises 10%, and as a result the quantity demanded falls by 10%, then one can conclude that the demand for orange juice
A) is perfectly elastic. B) is inelastic. C) has a unitary elasticity. D) has a constant elasticity.
The evidence from hyperinflations indicates that money growth and inflation
a. are positively related, which is consistent with the quantity theory of money. b. are positively related, which is not consistent with the quantity theory of money. c. are not related in a discernible fashion, which is consistent with the quantity theory of money. d. are not related in a discernible fashion, which is not consistent with the quantity theory of money.
Suppose a business firm dumps its used car batteries into a river.
A. The company's actions constitute an external cost. B. The company's actions constitute an external benefit. C. The company's actions would be an example of the market system efficiently allocating resources. D. The company's actions damage no one but itself.
When demand for labor is highly inelastic, many workers lose their jobs when the minimum wage is raised
Indicate whether the statement is true or false