Dr. Franke, a perpetual critic of economics, notes that a recent consultant to his medical practice had advised him to raise the prices he charged in order to raise his business revenues. At a university fundraising event he commented to the Chancellor regarding "how ludicrous" some of his faculty members were in giving advice that would drive customers away. He advised the Chancellor that more
"practical, experienced faculty" such as hired by the local Technical College were needed. If demand for Dr. Franke's services is inelastic
a. customers would increase and revenues drop
b. customers would increase and revenues expand
c. customers would decrease and revenues drop
d. customers would decrease and revenues expand
e. only cross-price elasticity is related to revenues
D
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Which of the following will cause the marginal cost curve of making cigarettes to shift?
A) a $5 million penalty charged to each cigarette maker B) a $1 per pack tax on cigarettes C) a $1 million advertising campaign by the American Cancer Society D) All of the above.
If Jayla's tax liability increases from $10,000 to $16,000 when her income increases from $30,000 to $40,000, her marginal tax rate is
a. 33 percent. b. 35 percent. c. 50 percent. d. 60 percent.
Kimani sells life insurance and is considering buying a $50,000 Cadillac for business purposes (thus, the expense reduces her taxable income). If Kimani is in the 40 percent marginal tax bracket, how much after-tax income will she have to give up in order to enjoy the Cadillac?
a. $20,000 b. $30,000 c. $25,000 d. $70,000
What is the struggle among various producers for the consumer's buisness called?
a) socialism b) competition c) incentive d) self-regulation