If the price elasticity of demand is greater than 1, then consumer demand is
A) unrelated to the elasticity of demand.
B) inelastic.
C) elastic.
D) unitary elastic.
Answer: C
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A firm producing bottled water reports the following production information:
# of Workers Total Product (gallons of water per hour) 0 0 10 1750 20 2750 30 3550 40 4150 50 4550 60 4750 The bottled water sells in a competitive market at a price of 10 cents per gallon. The firm hires workers in a competitive labor market at a wage of $7 per hour. The firm is currently hiring 20 workers and is considering hiring another 10 . What would you recommend the firm do? Why?
As entry of new firms occurs in an existing monopolistically competitive industry, the
a. market demand curve will shift to the right b. market demand curve will shift to the left c. demand curves of existing firms shift to the right d. demand curves of existing firms will become more price elastic e. market supply curve will shift to the left
A decrease in the price of one good results in a parallel shift in the budget line
a. True b. False Indicate whether the statement is true or false
Refer to Table 10.2. If the price of output is $1 per unit and we observe the firm hiring four workers, if the firm is maximizing profit, the wage rate must be between ________ and ________.
A. $35; $40 B. $30; $35 C. $45; $60 D. $80; $90