Suppose that, at the market clearing price of natural gas, the price elasticity of demand is -1.2 and the price elasticity of supply is 0.6. What will result from a price ceiling that is 10 percent below the market clearing price?
A) A shortage equal to 1.8 percent of the market clearing quantity
B) A shortage equal to 0.6 percent of the market clearing quantity
C) A shortage equal to 18 percent of the market clearing quantity
D) A shortage equal to 6 percent of the market clearing quantity
E) More information is needed.
Question 2
For the firm's cost minimization problem, one of the key assumptions for each input is that:
A) marginal product is constant.
B) marginal product is increasing at a decreasing rate.
C) marginal product is increasing at an increasing rate.
D) marginal product is decreasing at an increasing rate.
Natural capital degradation
An Oil-dependent World— Supply and Demand Driven
Natural Products
Natural Causes of Climate Change
Evolution and Natural selection shapes organisms and diversity
The impact of climate change on natural ecosystems