« previous next »

Author Question: Comment on the following statement: Elasticity is constant along a straight-line demand curve. ... (Read 200 times)

leilurhhh

  • Hero Member
  • *****
  • Posts: 560
on: Jun 29, 2018
Comment on the following statement: Elasticity is constant along a straight-line demand curve.
 
  What will be an ideal response?

Question 2

The firm shown in the figure above is
 
  A) a natural monopoly because its LRAC curve slopes downward where it intersects the demand curve.
  B) not a natural monopoly because its LRAC curve slopes downward where it intersects the demand curve.
  C) not a natural monopoly because its MC curve is horizontal.
  D) not a natural monopoly because its MC curve is below its LRAC curve.
Foundations of Microeconomics ¦ Bade, Parkin ¦ 8th Edition
Buy Test-Bank


ilianabrrr

  • Sr. Member
  • ****
  • Posts: 332
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is false. While the slope is constant along a straight line, the elasticity is not. In fact, at high prices (the upper area of a demand curve) the demand is elastic. As price falls (and quantity demanded increases), the price elasticity of demand gets smaller (in absolute value).

Answer to Question 2

A


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Earwax has antimicrobial properties that reduce the viability of bacteria and fungus in the human ear.

Did you know?

Less than one of every three adults with high LDL cholesterol has the condition under control. Only 48.1% with the condition are being treated for it.

Did you know?

Nearly 31 million adults in America have a total cholesterol level that is more than 240 mg per dL.

Did you know?

Fatal fungal infections may be able to resist newer antifungal drugs. Globally, fungal infections are often fatal due to the lack of access to multiple antifungals, which may be required to be utilized in combination. Single antifungals may not be enough to stop a fungal infection from causing the death of a patient.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

A typical distillation curve. Heavier molecules evaporate at higher temperatures and contain more ... A typical distillation curve. Heavier molecules evaporate at higher temperatures and contain more ...
How to find the equation of a line passing through two points How to find the equation of a line passing through two points
Time Line for Evolution of the Universe Time Line for Evolution of the Universe
What is the value of the equilibrium constant, K, at 25°C for the reaction? What is the value of the equilibrium constant, K, at 25°C for the reaction?
Construct a Lorenz curve that shows income distribution in this society. Construct a Lorenz curve that shows income distribution in this society.
Write equilibrium constant expressions for the following reactions in terms of concentration: Write equilibrium constant expressions for the following reactions in terms of concentration:
Video: Gastrulation: cross section of the frog

For a complete list of videos, visit our video library