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

Author Question: A profit maximizing single-price monopolist sets price equal to marginal cost. Indicate whether ... (Read 133 times)

jman1234

  • Hero Member
  • *****
  • Posts: 560
on: Jun 29, 2018
A profit maximizing single-price monopolist sets price equal to marginal cost.
 
  Indicate whether the statement is true or false

Question 2

When the price of raisins falls, the quantity of raisins demanded rises. Explain this change in terms of income and substitution effects.
 
  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

smrtceo

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

FALSE

Answer to Question 2

When the price of raisins falls, households have more purchasing power than before. If raisins are a normal good, this means that they will consume more of them. This is the income effect. Also, a decrease in the price of raisins makes raisins relatively less expensive. Thus, households will shift toward purchasing raisins from purchasing relatively more expensive goods. This is the substitution effect. Both effects imply that the quantity of raisins demanded will rise as the price of raisins falls.


jman1234

  • Member
  • Posts: 560
Reply 2 on: Jun 29, 2018
:D TYSM

nguyenhoanhat

  • Member
  • Posts: 332
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

In 2006, a generic antinausea drug named ondansetron was approved. It is used to stop nausea and vomiting associated with surgery, chemotherapy, and radiation therapy.

Did you know?

Patients who have undergone chemotherapy for the treatment of cancer often complain of a lack of mental focus; memory loss; and a general diminution in abilities such as multitasking, attention span, and general mental agility.

Did you know?

Side effects from substance abuse include nausea, dehydration, reduced productivitiy, and dependence. Though these effects usually worsen over time, the constant need for the substance often overcomes rational thinking.

Did you know?

The U.S. Preventive Services Task Force recommends that all women age 65 years of age or older should be screened with bone densitometry.

Did you know?

Methicillin-resistant Staphylococcus aureus or MRSA was discovered in 1961 in the United Kingdom. It if often referred to as a superbug. MRSA infections cause more deaths in the United States every year than AIDS.

Methicilli ...
A single crossover inserts F at a specific locus, which then determines the order of gene transfer A single crossover inserts F at a specific locus, which then determines the order of gene transfer
The tone of the nurse-patient introduction sets the stage for the patient interview and patient care The tone of the nurse-patient introduction sets the stage for the patient interview and patient care
Several common functional groups in a single biomolecule Several common functional groups in a single biomolecule
U.S. Subsurface Coal Mining: Output, Price, and Output per Worker-Hour, 1949–1994 U.S. Subsurface Coal Mining: Output, Price, and Output per Worker-Hour, 1949–1994
Cost Accounting: A Managerial Emphasis 16th Edition Cost Accounting: A Managerial Emphasis 16th Edition
Sonal bought a coat for $198.88, which included 8% PST and 5% GST. What was the selling price ... Sonal bought a coat for $198.88, which included 8% PST and 5% GST. What was the selling price ...
Video: Lipid absorption - end products & transport mechanism

For a complete list of videos, visit our video library