Author Question: If the elasticity of supply of TV sets is equal to 3, then a 10 percent increase in the price of a ... (Read 73 times)

audragclark · **on:** Jun 29, 2018

If the elasticity of supply of TV sets is equal to 3, then a 10 percent increase in the price of a TV will

A) increase the quantity supplied by 3.33 percent.
B) increase the quantity supplied by 30.0 percent.
C) increase the quantity supplied by 0.33 percent.
D) decrease the quantity supplied by 30.0 percent.

Question 2

Which of the following statements is TRUE about contestable markets?

A) There are significant barriers to entry.
B) Firms earn large economic profits.
C) Each firm faces a perfectly elastic demand.
D) There are few firms in the industry.