This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Consider the indifference maps shown above. If X and Y are perfect substitutes, your indifference ... (Read 148 times)

charchew

  • Hero Member
  • *****
  • Posts: 579
on: Jun 29, 2018
Consider the indifference maps shown above. If X and Y are perfect substitutes, your indifference curves between them would look like those in
 
  A) Figure A.
  B) Figure B.
  C) Figure C.
  D) Figure D.

Question 2

What effect does a price increase have on producers' total revenue?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

juliaf

  • Sr. Member
  • ****
  • Posts: 344
Reply #1 on: Jun 29, 2018
Answer to Question 1

A

Answer to Question 2

The effect of a price increase in total revenue depends on the elasticity of demand. If the demand is elastic, then total revenue will decrease because the decrease in the quantity demanded will outweigh the effect of the higher price. If the demand is inelastic, then total revenue will increase. In this case, the decrease in the quantity demanded is proportionally less than the increase in price and so the higher price leads to increased total revenue. Finally, if the demand is unit elastic, then the higher price does not change the total revenue. The percentage decrease in the quantity demanded just equals the percentage increase in the price and so the two effects just offset each other. The total revenue does not change.


charchew

  • Member
  • Posts: 579
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

bbburns21

  • Member
  • Posts: 336
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Certain rare plants containing cyanide include apricot pits and a type of potato called cassava. Fortunately, only chronic or massive ingestion of any of these plants can lead to serious poisoning.

Did you know?

Immunoglobulin injections may give short-term protection against, or reduce severity of certain diseases. They help people who have an inherited problem making their own antibodies, or those who are having certain types of cancer treatments.

Did you know?

Women are 50% to 75% more likely than men to experience an adverse drug reaction.

Did you know?

Disorders that may affect pharmacodynamics include genetic mutations, malnutrition, thyrotoxicosis, myasthenia gravis, Parkinson's disease, and certain forms of insulin-resistant diabetes mellitus.

Did you know?

Stevens-Johnson syndrome and Toxic Epidermal Necrolysis syndrome are life-threatening reactions that can result in death. Complications include permanent blindness, dry-eye syndrome, lung damage, photophobia, asthma, chronic obstructive pulmonary disease, permanent loss of nail beds, scarring of mucous membranes, arthritis, and chronic fatigue syndrome. Many patients' pores scar shut, causing them to retain heat.

Biopsy. Various forms of gynecological biopsy are shown. Biopsy. Various forms of gynecological biopsy are shown.
Desmosomes and gap junctions, as shown in heart muscle: Gap junctions Desmosomes and gap junctions, as shown in heart muscle: Gap junctions
Shown here is Pope Leo III crowning Charlemagne king of the Franks in 800. Shown here is Pope Leo III crowning Charlemagne king of the Franks in 800.
Structures of (a) free and (b) DNA-bound forms of BamHI, with DNA shown end-on, in orange Structures of (a) free and (b) DNA-bound forms of BamHI, with DNA shown end-on, in orange
An insertion sequence (IS), shown in purple An insertion sequence (IS), shown in purple
Rosalind Franklin, shown here on holiday, used X-ray diffraction to investigate the structure of DNA Rosalind Franklin, shown here on holiday, used X-ray diffraction to investigate the structure of DNA
Video: Buffers definition and the role of buffer in the body

For a complete list of videos, visit our video library