When producers price their items, they should realize there will usually be a consumer surplus when the items are sold. What does this mean to them?
a. They should price items one dollar above the market equilibrium price.
b. They should price items somewhat higher than what consumers are willing to pay for them.
c. They should price items exactly at what consumers are willing to pay for them.
d. They should price items somewhat lower than what consumers are willing to pay for them.
d. They should price items somewhat lower than what consumers are willing to pay for them.
You might also like to view...
All of the following are examples of public goods except
A) clean water systems. B) stock of knowledge in the public domain. C) crime prevention. D) broadcast television with commercials.
Economic bads are items
A) for which the produced quantity is less than the amount desired at a positive price. B) for which the desired quantity is less than what nature provides at a zero price. C) that individuals desire but which receive social disapproval. D) that receive social approval but which governments dislike.
If the price of a good increases from $20 to $25 and the quantity demanded declines from 15 to 10 units of the good, the price elasticity of demand is 5
a. True b. False
The disposable income component of aggregate demand is equal to:
a. income before taxes. b. income after taxes. c. operating income. d. investment income.