A monopoly's economic profits are represented by
a. [price minus marginal cost] times number of units sold.
b. [price minus average cost] times number of units sold.
c. [marginal revenue minus price] times number of units sold.
d. [marginal cost minus price] times number of units sold.
b
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Suppose that Argentina's dollar-denominated external assets and liabilities are $10 billion and $100 billion, respectively, and its Argentine peso-denominated external assets and liabilities are each 50 billion pesos (P). Suppose further that Argentina fixes its exchange rate at P1 = $US1. What is the likely effect of the change in Argentina's external wealth on Argentine aggregate demand as a result of the devaluation of the peso (from P1 = $US1 to P3 = $US1)?
A) It will increase Argentine aggregate demand. B) It will decrease Argentine aggregate demand. C) It will neither increase nor decrease Argentine aggregate demand. D) It will first increase, then decrease Argentine aggregate demand.
How does elasticity of supply differ for a product that can be stored, compared to a product that cannot be stored?
What will be an ideal response?