Use the data in the table below to answer the following question.PriceQuantity Demanded$201218171620142412301036840644448The price elasticity of demand (based on the midpoint formula) when price decreases from $20 to $18 is
A. -1.37.
B. -0.33.
C. -3.29.
D. -1.
Answer: C
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If a firm can charge different prices for each consumer it can practice
A) second degree price discrimination. B) perfect price discrimination. C) third degree price discrimination. D) consumer surplus reversal
Which of the following events would decrease producer surplus?
a. Sellers' costs stay the same and the price of the good increases. b. Sellers' costs increase and the price of the good stays the same. c. Sellers' costs decrease and the price of the good increases. d. All of the above are correct.
Which of the following statements is true?
A) If a nation can produce more of a good than another nation can, it has a comparative advantage in the production of that good. B) Comparative advantage results from a lower opportunity cost of production. C) Absolute advantage results from having more resources. D) Absolute advantage means that an individual or country can produce more of a particular good than can any other individual or country.
An expansionary fiscal policy would be countercyclical if it was enacted after:
A. equilibrium income fell below potential income. B. unemployment fell. C. equilibrium income rose above potential income. D. inflation rose.