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 191 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
Excellent

phuda

  • Member
  • Posts: 348
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

According to the Migraine Research Foundation, migraines are the third most prevalent illness in the world. Women are most affected (18%), followed by children of both sexes (10%), and men (6%).

Did you know?

Thyroid conditions cause a higher risk of fibromyalgia and chronic fatigue syndrome.

Did you know?

The average human gut is home to perhaps 500 to 1,000 different species of bacteria.

Did you know?

Cocaine was isolated in 1860 and first used as a local anesthetic in 1884. Its first clinical use was by Sigmund Freud to wean a patient from morphine addiction. The fictional character Sherlock Holmes was supposed to be addicted to cocaine by injection.

Did you know?

In ancient Rome, many of the richer people in the population had lead-induced gout. The reason for this is unclear. Lead poisoning has also been linked to madness.

Shown eating. Cougars are ambush predators, feeding mostly on deer and other mammals. Shown eating. Cougars are ambush predators, feeding mostly on deer and other mammals.
Glaucoma. (a) A buildup of pressure within the eye cavities, often caused by a blockage of vessels t Glaucoma. (a) A buildup of pressure within the eye cavities, often caused by a blockage of vessels t
Cystoscopy. In this procedure, a specialized endoscope with a rigid tube, known as a cystoscope, is Cystoscopy. In this procedure, a specialized endoscope with a rigid tube, known as a cystoscope, is
To maintain global power requires the continuous development of weapons. Shown here is the Osprey. ... To maintain global power requires the continuous development of weapons. Shown here is the Osprey. ...
Which outcome corresponds to the combination of silver and carbonate ions shown in the ... Which outcome corresponds to the combination of silver and carbonate ions shown in the ...
Which of the 3 structures shown below has the shortest bond length? Justify your answer. Which of the 3 structures shown below has the shortest bond length? Justify your answer.
Video: Prone Position

For a complete list of videos, visit our video library