If Supply Decreases and Total Revenue in an Industry Increases

question 30

Multiple Choice

If supply decreases and total revenue in an industry increases,

• A)demand elasticity must be equal to 1.
• B)demand must be horizontal.
• C)demand elasticity must be greater than 1.
• D)we have a perfectly implausible situation.
• E)demand elasticity must be less than 1.

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Definitions:

Schemata

Frameworks for organizing and representing knowledge that contain roles, variables, and fixed parts.

Prototype View

A theory in cognitive science that suggests people categorize objects and ideas by comparing them to an internal "best example" or prototype of a category.

Exemplar View

a theory in cognitive psychology suggesting that individuals categorize objects and ideas by comparing new experiences to specific examples stored in memory.

Superordinate Level

A high-level classification or grouping that is more abstract than its lower-level counterparts in hierarchical arrangements.