The opportunity cost of installing a traffic light at a dangerous intersection is best described by which of the following? Definition Products are standardized or homogeneous Term A profit-maximizing firm in the short run will expand output: Definition As long as marginal revenue is greater than marginal cost Term Refer to the graph below. As the quantiy of bread produced increases, the opportunity cost of an additional unit of bread increases A cross elasticity of demand and coefficient of +2. In a market system, prices serve to ration goods and services to consumers. As a result, the equilibrium price of pink salmon has. The quantity bought remains unchanged at 100 barrels. Because so many firms were competing to establish themselves in the market, economic costs could not be covered because of higher prices. If the demand for product X is inelastic, a 4 percent increase in the price of X will: A.
When firms like Google, Ebay and Amazon realized that they could not produce profits in the dot-com industry they removed themselves from industry and they industry declined. This means that the firm will: Definition Set price above marginal cost Term The graph depicts a monopolistically competitive firm Refer to the above graph. Definition Price rises and Ed equals 2. The basic formula for the price elasticity of demand coefficient is: A. According to Sharp, et al. Refer to the table above.
In the range of prices in which demand is elastic, total revenue will diminish as price decreases. If it is done so, he may not be in a position to raise his sales. Demand rises and supply rises. Points : 4 income, preferences, or the number of suppliers change income, preferences, or the number of buyers change income, preferences, or production technology change production technology and input prices change Question 6. Points : 4 Price rises and output falls. Definition Price rises and Ed equals 2.
Question 25 If government imposes a price ceiling on a good that is below the market equilibrium price a. If price and total revenue are directly not inversely related, demand is inelastic. If you operated a small bakery, which of the following would most likely be a variable cost in the short run? We do not share your email address with others. An inverse relationship is graphed with a downward slope. It is because additional units are sold at the same price as before.
Especially if there are no other universities nearby that the students could transfer to. The following economy produces two products. Demand rises and supply falls. What is the equation for Total Revenue? Demand rises and supply rises. While new equipment in the 1950s helped bring back some passengers, overall the returns fell extremely short and in the end it only proved to be a costly waste of money as the decline only continued. Supply rises and demand falls. It could be above equilibrium so people aren't buying.
He or she could maximize profits by: Definition Decreasing price and increasing output Term Which of the below shows the correct relationship between demand and marginal revenue? When international specialization occurs domestic resources are directed to output that a nation produces. The decrease in quantity demanded of a product as a result of the price increase caused by the excise tax will be less than the increase price yet still in proportion. The revenue schedule for a competitive firm is shown in the table 5. Is it Elastic, Inelastic, or Unitary Elastic? An increase in the price of beef results in an increase in the demand for fish. Change in the market What happens to total revenue? Demand tends to be elastic at high prices and inelastic at low prices. In which of the following instances will the effect upon equilibrium price be indeterminant, that is, dependent upon the magnitude of the given shifts in supply and demand? The marginal revenue of the 10 unit of sales is. I'll take a stab though.
What might prompt the government to establish this price ceiling? Total revenue declines if price is increased. Definition Elasticity would be very important. The price elasticity of supply in this range is: Definition. This is because the monopolist seller ordinarily has to accept a lower price for his product, as he increases his sales. This can be shown with the help of table 6. Question 5 When the price of a product increases, a consumer is able to buy less of it with a given money income.
Pure monopoly If a firm has at least some control over the price of its product, then the firm cannot be in which of the following market models. Definition automobiles Term If in the short run the demand for mass transit is inelastic and in the long run the demand is elastic, then a price: Definition increase will increase total revenue in the short run but decrease total revenue in the long run. Refer to the figure about, which is the output schedule of a firm using input X. Term In a market economy, entrepreneurs are most concerned with: Definition maximizing profits or minimizing losses. In this market: Definition demand has increased and equilibrium price has decreased Term If the price elasticity of demand for a good is. A rising rate of labor productivity growh is a valid explanation for real wage growth. Question 1 if a product is in surplus supply, we can conclude that its price: is below the equilibrium level.