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Economics Model Answers Twelve - 2013 (view source)

Revision as of 15:44, June 8, 2013

336 bytes added ,  15:44, June 8, 2013
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:The good must be price inelastic.
 
:The good must be price inelastic.
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:"The good is price inelastic. After all, my revenue is PQ. Due to the law of demand, when P increases, Q decreases. However, my study of the market reveals that increasing P will increase my revenue: thus, Q must not decrease very much in response to the increase in price. This characterizes a price inelastic good." (by student JA)
    
5.  A monopolistic competitive firm has the following characteristic that ''is lacking'' for a perfectly competitive firm:
 
5.  A monopolistic competitive firm has the following characteristic that ''is lacking'' for a perfectly competitive firm:
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