A profit-maximizing firm will base its supply decisions on its marginal:
a. private cost.
b. social cost.
c. external cost.
d. transactions cost.
a
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The derived demand curve for a good component will be more inelastic
A) the larger is the fraction of total cost going to this component. B) the more inelastic is the demand curve for the final good. C) the more elastic are the supply curves of cooperating factors. D) the less essential is the component in question.
Richard Voith estimated the price elasticity of demand for round-trip rail fare to be 0.62. If fares rose by 30 percent, one would expect the quantity of round-trip tickets purchased to:
A. rise by 18.6 percent. B. fall by 48.4 percent. C. fall by 18.6 percent. D. rise by 48.4 percent.
Dumping refers to the practice of one country selling off its surplus goods in other countries
Indicate whether the statement is true or false
The underlying cause of inflation is
a. labor unions demanding higher wages. b. businesses charging higher prices. c. government raising taxes. d. increasing aggregate demand.