In a three-player game, each player must have three choices

A firm sets its price at $10.00 per unit. It has an average variable cost of $8.00 and an average fixed cost of $4.00 per unit. In the short run, this firm is a. incurring a loss of $2.00 per unit and should shut down

b. unable to cover all of its fixed cost and hence should shut down. c. incurring a profit. d. incurring a loss per unit of $2.00, but since it can still cover its variable costs, should continue to operate

If income decreases by 20% and, in response, the quantity of housing demanded decreases by 14%, then the income elasticity of demand for housing is

A. -1. B. 1.43. C. -0.7. D. 0.7.