Author Question: Which of the following best describes a good with perfectly elastic supply? A) Any increase in ... (Read 57 times)

sabina · **on:** Jun 29, 2018

Which of the following best describes a good with perfectly elastic supply?

A) Any increase in the price of the good leads to an increase in the seller's revenue.
B) Any increase in the price of the good decreases the quantity supplied of the good by more than the price change.
C) Any increase in the price of the good will induce the firm to supply an infinite quantity of the good.
D) Any increase in the price of the good increases the quantity supplied of the good exactly by the amount of the price change.

Question 2

The cost of producing aspirin increases simultaneously as doctors find that one aspirin per day reduces the risk of heart attacks. The supply of aspirin ________ and the demand for aspirin ________ so that the equilibrium price of aspirin ________.

A) increases; increases; rises
B) decreases; increases; rises
C) increases; decreases; might rise, fall, or stay the same
D) decreases; increases; might rise, fall, or stay the same