The long-run supply curve would be perfectly elastic when:
A. An increase in demand does not cause a change in product price
B. An increase in demand causes an increase in product price
C. A decrease in demand causes an increase in short-run supply
D. A decrease in demand causes an increase in product price
A. An increase in demand does not cause a change in product price
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Which of the following regarding a monopolist is INCORRECT?
A) The monopolist is a single supplier of a good or service. B) The monopolist constitutes the entire industry. C) Only expensive products are produced by monopolies. D) There are barriers to entry that allow monopoly.
What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that coffee prevents heart attacks?
a. Both the equilibrium price and quantity would increase. b. Both the equilibrium price and quantity would decrease. c. The equilibrium price would increase, and the effect on equilibrium quantity would be ambiguous. d. The equilibrium quantity would increase, and the effect on equilibrium price would be ambiguous.