Author Question: If a consumer purchases only two goods (x and y) and the demand for x is elastic, then a rise in the ... (Read 64 times)

Garrulous · **on:** Jul 1, 2018

If a consumer purchases only two goods (x and y) and the demand for x is elastic, then a rise in the price of x:
a. will cause total spending on good y to rise.
b. will cause total spending on good y to fall.
c. will cause total spending on good y to remain unchanged.
d. will have an indeterminate effect on total spending on good y.

Question 2

Of the following, which is not an economic rationale for public utility regulation?
a. production process exhibiting increasing returns to scale
b. constant cost industry
c. avoidance of duplication of facilities
d. protection of consumers from price discrimination
e. none of the above