A monopoly sets a price of $50 per unit for an item that has a marginal cost of $10. Assuming profit maximization, the implicit demand elasticity is

An economy is in the midst of a recession. An example of a government policy aimed at moving the economy back to potential GDP is:

a) an increase in taxes. b) an increase in government spending on infrastructure improvements. c) an increase in the poverty tax. d) a decrease in unemployment benefits.

If perfectly competitive firms exit a market, the

A) market supply curve shifts leftward. B) price of the good or service falls. C) profits of the remaining firms decrease. D) output of the industry increases.