If the price of cappuccino on campus falls from $5 to $3 and the quantity demanded increases from 15 to 20, then the price elasticity of demand is approximately
A) 0.47, which mean cappuccino is inelastic.
B) 0.57, which means cappuccino is inelastic.
C) 1.75, which means cappuccino is elastic.
D) 2.25, which means cappuccino is elastic.
B
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In profit centers
a. Managers are difficult to evaluate because there is no simple metric of how well they performed b. Managers typically do not have the information to run their division efficiently c. Managers' decisions rarely affect other divisions d. Managers typically have ample incentives to run their division efficiently
Your boss gives you an increase in the number of dollars you earn per hour. This increase in pay makes
a. your nominal wage increase. If your nominal wage rose by a greater percentage than the price level, then your real wage also increased. b. your nominal wage increase. If your nominal wage rose by a greater percentage than the price level, then your real wage decreased. c. your real wage increase. If your real wage rose by a greater percentage than the price level, then your nominal wage also increased. d. your real wage decrease. If your real wage rose by a greater percentage than the price level, then your nominal wage decreased.
When a profit-maximizing firm in a competitive price-searcher market is in long-run equilibrium, price equals
a. marginal cost, and profits are positive. b. average total cost, and profits are zero. c. marginal cost, and profits are zero. d. average total cost, and profits are positive.
In a particular production process, if the quantities of all inputs used are increased by 60%, then the quantity of output increases by 60% as well. This means that
a. the production process cannot be enhanced by technological advances. b. no mathematical representation of the relevant production function can be formulated. c. the relevant production function has the limits-to-growth property. d. the relevant production function has constant-returns-to-scale.