Refer to Exhibit 9.2, which shows the cost and revenue curves faced by a monopolist. The demand curve faced by the monopolist at the profit-maximizing output is _____
A) perfectly price elastic.
B) price elastic.
C) price inelastic.
D) unit price elastic.
E) perfectly price inelastic.
Answer: B) price elastic.
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If you overhear a group of people talking about their plans to save for their retirement and one of them says that it causes them to save less because, as they reason it, "the government is saving for me," you would attribute this to the
A. asset substitution effect. B. induced retirement effect. C. slovenly effect. D. bequest effect.
Barometric price leadership exists when
A) one firm in the industry initiates a price change and the others may or may not follow. B) one firm imposes its best price on the rest of the industry. C) when all firms agree to change prices simultaneously. D) when one company forms a price umbrella for all others.
According to the principle of comparative advantage, total output and consumption levels will be highest when goods are produced in nations according to which of the following conditions?
A. Opportunity costs are lowest. B. Absolute advantages are highest. C. Opportunity costs are equal. D. Absolute advantages are lowest.
Perfect price discrimination would eliminate consumer _________________.
Fill in the blank(s) with the appropriate word(s).