When prices drop in response to a decline in demand for an increasing cost industry
a. producer surplus will increase but rents may decrease.
b. rent earned by elastically supplied inputs will decline by more than rent earned by inelastically supplied inputs.
c. rent earned by elastically supplied inputs will decline by less than rent earned by inelastically supplied inputs.
d. both producer surplus and rents will increase.
c
You might also like to view...
Corporations have the disadvantage of which of these? (i) double taxation; (ii) unlimited liability.
A. (i) and (ii) B. (i) but not (ii) C. (ii) but not (i) D. neither (i) nor (ii)
Economic freedom refers to the freedom of the government to control resources and labor in a country
a. True b. False Indicate whether the statement is true or false
If indirect business taxes and depreciation were added to the national income, we obtain: a. Net National product
b. Gross National Product. c. Gross Domestic Product. d. Personal Income.
For a given amount of total reserves, a decrease in required reserves causes an increase in excess reserves.
a. true b. false