If the supply of good A is perfectly elastic, a decrease in demand will:
a. reduce the equilibrium quantity traded, but leave the price unchanged.
b. reduce the equilibrium quantity traded, and reduce the price
c. reduce the equilibrium price, but leave the quantity traded unchanged.
d. reduce the equilibrium price traded, but increase the quantity traded.
a
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In constructing the Human Development Index, high income levels are given less than proportionate weight because
a. Items bought by rich people are luxuries, not necessities. b. United Nations bureaucrats are prejudiced against the rich. c. Dollars received by rich people may have a lower marginal utility than dollars received by poor people. d. Items bought by rich people create more pollution than those bought by the poor. e. All of the above are valid reasons.
If a firm is to capture all consumer surplus with two-part pricing when customers are different
A) it must be able to charge different access fees. B) it cannot charge different prices for access fees. C) it must set unit price below marginal cost. D) it must set unit price above marginal cost.