When comparing price elasticities of demand in the long run to the short run, what can we say about the long-run elasticities?
a. Within every price range, the price elasticity of demand is more elastic.
b. Consumers are less sensitive to price changes.
c. Consumers are inclined to make fewer adjustments to quantity demanded when price changes
d. Within every price range, the price elasticity of demand is less elastic.
e. Because consumers had more time to adjust to a price decrease or increase, their reaction to either is much smaller.
A
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The decrease in consumer surplus and producer surplus that results from an inefficient level of production is called the
A) external cost. B) external benefit. C) deadweight loss. D) big tradeoff.
Adverse selection in insurance requires that
a. potential customers face different levels of risk b. potential customers facing more risk are no more interested in purchasing insurance c. people are not risk averse d. insurers can tell higher risk people from lower risk people