Author Question: Suppose the government imposes a 1 tax on frisbees, and the price of a frisbee paid by demanders ... (Read 79 times)

oliviahorn72 · **on:** Jun 29, 2018

Suppose the government imposes a 1 tax on frisbees, and the price of a frisbee paid by demanders rises by 1.

A) The price rise is consistent with a perfectly elastic supply for frisbees.
B) The price rise is consistent with a perfectly elastic demand for frisbees.
C) The price rise is consistent with a downward-sloping supply curve for frisbees.
D) The price could never rise this much, so this situation cannot happen.

Question 2

Christy is a telemarketer. She estimates that this summer, she has a 0.2 probability of earning 10,000, a 0.5 probability of earning 5,000, and a 0.3 probability of earning only 1,000. What is Christy's expected income?

A) 7,256
B) 5,333
C) 4,800
D) 4,000