When many substitutes exist for a good, demand will be
A. unit-elastic.
B. perfectly unit-elastic.
C. inelastic.
D. elastic.
Answer: D
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An investor will choose to diversify the portfolio to reduce risk.
Answer the following statement true (T) or false (F)
Susan argues that she is the victim of economic discrimination. The primary technical difficulty for an economist investigating her claim will be
A. defining economic discrimination. B. finding a worker with the same productivity as Susan for comparison purposes. C. defining statistical discrimination. D. measuring Susan’s human capital.
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.Given the dominant strategy of MiiTunes according to the figure, we can predict that The Rock Shop:
A. Their actions cannot be predicted because they do not have a dominant strategy. B. will enter and lose $2 million. C. will enter and enjoy profits of $4 million. D. will not enter and earn $0.
In economics, what term is used to refer to having a lower opportunity cost than other producers?
a. effective exchange b. negative incentive c. comparative advantage d. comparable worth