All else constant, an increase in the number of buyers in the market for cell phone service would cause:
A) equilibrium price and quantity to increase.
B) equilibrium price and quantity to decrease.
C) equilibrium price to increase and equilibrium quantity to decrease.
D) equilibrium price to decrease and equilibrium quantity to increase.
A
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Compared to the perfectly competitive outcome, monopolistically competitive markets will result in:
a. a wider variety of products and higher prices. b. less product variety and higher prices. c. a wider variety of products and lower prices. d. less product variety and lower prices.
A study of the effects of the minimum wage on employment of low-skilled workers estimated the price elasticity of demand for low-skilled workers is -0.75. Suppose that the government is considering raising the minimum wage from $7.25 per hour to $7.75
per hour. Based on this information, calculate the percentage change in the employment of low skilled workers. Use the midpoint formula. What will be an ideal response?