Using the figure above, suppose Starbucks charges $4.50 per cup for its latte. Which of the following is true?
i. At this price, the demand for Starbucks latte is elastic.
ii. If Starbucks lowers the price of its latte, its revenue will decrease.
iii. If Starbucks raises the price of its latte, the demand for it will become less elastic.
A) Only iii
B) Only i
C) Only ii
D) i and ii
E) i and iii
B
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Comparative advantage in production of a good occurs
A. when a country can produce that good using fewer resources than could other countries. B. when a country can produce that good at a greater opportunity cost than could other countries. C. when a country can produce that good at a lower opportunity cost than could other countries. D. when a country has a greater supply of natural resources required to produce that good, compared to other countries.
People do not usually behave in a noncooperative fashion even when it is in their immediate interest to do so because
A) they realize such behavior is immoral. B) they know there can be 2 winners. C) they know they will have repeated dealings with the other people. D) they understand the difficulties with game theory.