If demand for Farmer John's maple syrup is inelastic, then when Farmer John raises the price of maple syrup, his total revenue will
A) increase.
B) decrease.
C) stay the same.
D) probably change, but more information is needed to determine if the total revenue increases, decreases, or stays the same.
A
You might also like to view...
The time it takes for a one-dollar addition to bank reserves to work its way through the banking system and the financial portfolios of the public and have its full impact on the stock of money
A) is about one quarter of a year. B) is between six and nine months. C) is not yet known precisely because little empirical research has been done on the question. D) probably cannot be predicted from an examination of historical data.
The concept of adverse selection helps to explain
A) why collateral is not a common feature of many debt contracts. B) why large, well-established corporations find it so difficult to borrow funds in securities markets. C) why financial markets are among the most heavily regulated sectors of the economy. D) why stocks are the most important source of external financing for businesses.
Once an equilibrium is achieved, it can persist indefinitely because
A) shocks that shift the demand curve or the supply curve cannot occur. B) shocks to the demand curve are always exactly offset by shocks to the supply curve. C) the government never intervenes in markets at equilibrium. D) in the absence of supply/demand shocks no one applies pressure to change the price.
Opportunity cost is illustrated on the production possibilities curve by a
A) bowed-out shape of the curve. B) shift to the right of the curve. C) shift to the left of the curve. D) movement along the curve.