If the market price for a good produced by a price taking firm is $5, the firm's total revenue is
A. downward sloping.
B. a flat line at P=$5.
C. an upward sloping line beginning at the origin and having a slope of 5.
D. parabolic.
Answer: C
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Charlie will purchase 10 percent more cans of Coke if the price of a can of Coke falls by 5 percent. Charlie's price elasticity of demand for cans of Coke is:
A. 1/2. B. 5. C. 10. D. 2.
A temporary decrease in the price of oil would be considered a:
A. long-run supply shock. B. demand shock. C. short-run supply shock. D. The changing price of oil would not affect any of these.
Firms 1 and 2 compete in a Cournot duopoly. If firm 1 adopts a strategy that raises firm 2's marginal cost:
A. firm 1 will increase market share. B. firm 2 will increase its output. C. firm 1 will suffer lower profits. D. All of the statements associated with this question are correct.
Which of the following is NOT considered to be a benefit of unionism?
A) increased featherbedding B) greater workplace safety C) higher workforce stability D) provision of arbitration and grievance procedures