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1. When the price of a product is increased 10 percent, the quantity demanded decreases 15 percent. In this range of prices, demand for this product is ( ) a. elastic. b. inelastic. c. cross-elastic. d. unitary elastic. 2. Total revenue falls as the price of a good is raised, if the demand for the good is ( ) a. elastic. b. inelastic. c. unitary elastic. d. perfectly elastic. 3. The price elasticity of demand increases with the length of the period considered simply because ( ) a. consumers' incomes will increase over time. b. the demand curve will shift outward as time passes. c. all prices will increase over time. d. consumers will be better able to find substitutes. 4. A state…show more content…
reducing production to the point where variable costs are minimized. b. reducing production to the point where unit costs are minimized. c. reducing its output and simultaneously increasing its price. d. increasing its output. 15. In pure competition, each extra unit of output that a firm sells will yield a marginal revenue that is ( ) a. equal to the price. b. less than the price. c. greater than the price. d. equal to the average cost. 16. Which of the following is a barrier to entry? ( ) a. Patents b. Revenue maximization c. Profit maximization d. Elastic product demand 17. Which is the best example of price discrimination? ( ) a. An airline company charging lower fares per pound for air freight than for passengers. b. A telephone company charging lower rates to weekend users than weekday users. c. A supermarket charging lower prices in its inner city store than its out-of-town store. d. A private doctor charging higher fees to patients receiving special services than patients receiving regular services. 18. A high concentration ratio indicates that ( ) a. the industry is highly profitable. b. the industry is highly competitive. c. many firms produce most of the output in an industry. d. few firms produce most of the output in an industry. 19. Money is not an economic resource because ( ) a. money, as
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