A tavern is likely to have a ______________________ price elasticity of supply than does an antiques dealer due to ______________________.
A. more elastic; availability of inputs
B. less elastic; availability of inputs
C. less elastic; a longer adjustment time
D. less elastic; a shorter adjustment time
A. more elastic; availability of inputs
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Banks and customers are most likely to be reluctant to use the full lending capacity made available by the Federal Reserve when the economy experiences
A. High inflation rates. B. A deep recession. C. Growth and low interest rates. D. Growth and inflation rates higher than the interest rate.
Assume that an individual has to decide between a two-day vacation and a three-day vacation to the same place. If he uses optimization in differences, he will:
A) only think about the net benefits of the extra day. B) compare the total net benefits of both alternatives. C) choose the three-day vacation only if the costs incurred on the third day exceed the benefits he receives. D) spend more time to come to a decision than if he would have used optimization in levels.