Refer to Figure 9-5. Without the tariff in place, the United States consumes
A) 12 million pounds of coffee. B) 26 million pounds of coffee.
C) 33 million pounds of coffee. D) 45 million pounds of coffee.
D
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To maximize profit, a firm in monopolistic competition will produce the quantity where marginal revenue
A) is greater than marginal cost. B) equals zero. C) is less than marginal cost. D) equals marginal cost. E) equals average total cost.
If the price level rose in three consecutive years from 100 to 120 to 140, then the annual inflation rate over those years would
A) decrease. B) remain the same. C) equal 20%. D) increase.
When demand is elastic,
A) changes in price and changes in total revenue move in the same direction. B) there is no relationship between changes in price and changes in total revenue. C) changes in price and changes in total revenue move in opposite directions. D) for any change in price, total revenue will not change.
A regional airline owns 10 aircraft and employs 20 pilots. The airline makes an average of three trips per day with each of its 10 aircraft. The aircraft and their ground crews are idle part of the day. Minimum rest requirements for its pilots mean that if the airline wants to increase its flights, it must hire more pilots. The decision to hire more pilots is:
A. a short-run decision because the number of pilots is being increased; if the number of ground crew were decreased instead, it would be a long-run decision. B. a short-run decision because the number of aircraft is held constant while the labor input is changed. C. a long-run decision because customers will become accustomed to the new flight schedule. D. a long-run decision because hiring pilots will increase revenues over a long period of time for the airline.