Holding all other factors constant and using the midpoint method, if a candy manufacturer increases production by 20 percent when the market price of candy increases from $0.50 to $0.60, then supply is
a. inelastic, since the price elasticity of supply is equal to .91.
b. inelastic, since the price elasticity of supply is equal to 1.1.
c. elastic, since the price elasticity of supply is equal to 0.91.
d. elastic, since the price elasticity of supply is equal to 1.1.
d
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A production subsidy combined with free trade
A) has the same deadweight costs as a tariff. B) has only consumption deadweight costs. C) has only production deadweight costs. D) None of the above.
By definition, the labor force participation rate is
A) the percentage of institutionalized working-age individuals who are employed or seeking employment. B) the percentage of noninstitutionalized working-age individuals who are employed or seeking employment. C) the annual rate of growth in the number of people who are either employed or searching for available jobs. D) the annual rate of growth in the number of people who are unemployed and searching for available government-provided unemployment benefits.