Refer to Figure 29-1. Currency speculators believe that the value of the euro will decrease relative to the dollar. Assuming all else remains constant, how would this be represented?
A) Supply would increase, demand would increase and the economy moves from D to A to B.
B) Supply would decrease, demand would increase and the economy moves from A to D to C.
C) Supply would increase, demand would decrease and the economy moves from C to B to A.
D) Supply would decrease, demand would decrease and the economy moves from B to C to D.
B
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West Coast Gas, Inc, is a natural gas supplier. The firm faces the demand schedule shown in the table above and cannot price discriminate
The company's fixed cost is $1,000 per month and its marginal cost is constant at $10 per thousand of cubic feet. The government imposes a marginal cost pricing rule on the company. a) What is the price of natural gas supplied by West Coast Gas? How many cubic feet does the company sell? What is the firm's economic profit per month? b) How does the regulation affect total surplus? c) Is the regulation in the social interest? Explain.
Many manufacturers sell products labeled as having imperfections at a discount at their factory outlets but do not ship these imperfect goods to regular retail outlets. Why?
What will be an ideal response?