Category: Economics

Question 8The opportunity cost of an activitydepends on an individual’s values and opinions.is the same for everyone.cannot be calculated.is irrelevant to decision making.is not related to time.

c. If the marginal cost of a book is $10, what is the change in profit after theBooks.com price change assuming that all the high-price customers thatwere lost now purchase at the lower price?

Greta is working with agent Brandon to sell some property. Nelson represents the buyer, Rigby. Of these four parties, who will pay the earnest money?
BrandonGretaNelsonRigby

Multiple Choice QuestionA change in a nonprice determinant of demand will:
result in a movement along the demand curve.
rarely occur.
result in a shift of the demand curve.
cause the market to fall.

➤ How do rising interest rates and refinancing risk pressure owners to increase capital expenditures?
Higher rates raise debt service and shrink cash flow, forcing owners to boost building competitiveness to retain tenants and justify rents. Many invest in upgrades, amenities, or energy efficiency to attract occupiers and protect valuation. Repositioning can be necessary to meet lender expectations and cover higher financing costs.

➤ How do you interpret an elasticity of 2?
An absolute elasticity of 2 means quantity demanded changes twice as much, in percent terms, as the price. Demand is elastic, so a price increase will reduce total revenue because the percentage drop in quantity exceeds the percentage price rise. Firms should weigh revenue and cost effects before raising price.

➤ Why is the statement that government governs production and prices in free enterprise false?
The statement describes a centrally planned system, not free enterprise. Free enterprise lets producers and consumers choose outputs and prices through market interaction. Government typically enforces rules and corrects clear market failures, but it does not routinely dictate what, how, or at which price most businesses must operate.