If the value of the price elasticity of demand is 0.2, this means that:
a. a 20 percent decrease in price causes a 1 percent increase in quantity demanded.
b. a 0.2 percent decrease in price causes a 1 percent increase in quantity demanded.
c. a 5 percent decrease in price causes a 1 percent increase in quantity demanded.
d. a 0.2 percent decrease in price causes a 0.2 percent increase in quantity demanded.
e. a 100 percent decrease in price causes a 200 percent increase in quantity demanded.
c
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Explicit costs would include:
a. rent. b. the interest loss of the business owner on money withdrawn from his/her saving account and invested in the business. c. the loss of rent on a building the business owner owns and uses in his/her business. d. the opportunity costs of the business owner's time. e. the use of tools owned by the business owner and dedicated to the business.
For a monopoly market, total surplus can be defined as the value of the good to
a. producers minus the cost incurred by consumers. b. producers plus the cost incurred by consumers. c. consumers minus the costs of producing the good. d. consumers plus the cost of producing the good.