Homework Clinic
Social Science Clinic => Economics => Topic started by: jlmhmf on Jun 29, 2018
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The term fixed cost refers to the cost a firm incurs to produce a specific fixed quantity of output.
Indicate whether the statement is true or false
Question 2
Suppose that the price elasticity of demand for museum tickets is equal to 1.8 . If the price of a museum ticket rises by 30 percent, what will happen to quantity demanded?
What will be an ideal response?
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Answer to Question 1
FALSE
Answer to Question 2
percentage change in quantity demanded/30 = -1.8 . If the price rises by 30 percent, quantity demanded will fall by 54 percent.