A monopoly faces an inverse demand curve of P = 100 - 2Q. The marginal cost curve is MC = .5Q. What government price ceiling would represent optimal price regulation?
What will be an ideal response?
Setting P = 100 - 2Q = .5Q = MC, the optimal price ceiling is $40.
Economics
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Assume that the research team of a major company is building a model of consumer demand that contains approximately 250 variables. Can you think of a principle that might be violated here that was discussed in chapter 1? Explain
What will be an ideal response?
Economics
Other things constant, a decrease in the price of fertilizer will: a. increase the supply of wheat
b. decrease the supply of wheat. c. increase the demand for wheat. d. decrease the demand for wheat.
Economics