A firm with a highly inelastic demand for coal will:
A. cut consumption less than a firm with a highly elastic demand when price goes up.
B. refuse to cut consumption for any reason.
C. stop using coal entirely if a tax is imposed.
D. cut consumption more than a firm with a highly elastic demand when price goes up.
Answer: A
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A) can be interpreted as 100 multiplied by real GDP divided by nominal GDP. B) is the difference between nominal GDP and real GDP. C) measures the average price level. D) can be interpreted as real GDP minus nominal GDP and the resulting difference then multiplied by 100. E) is equal to between real GDP minus nominal GDP.
Attempts to create a monopoly by having favorable laws passed are examples of rent seeking
Indicate whether the statement is true or false