The Figure Above Shows the Demand and Cost Curves Facing

question 38

Multiple Choice

The figure above shows the demand and cost curves facing a price-setting firm.In profit-maximizing (or loss-minimizing) equilibrium,the Lerner index is _____,and the elasticity of demand is ______.

• A)1 ; -1
• B)0.6; -1.667
• C)0.5; -2.0
• D)0.667; -1.5
• E)1.33; -0.75

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Definitions:

Layout Tactics

Strategies used in arranging machinery, equipment, and workforce within an operational area to optimize productivity and efficiency.

Waste

Describes materials or substances that are no longer useful in their current form and are discarded or disposed of.

Push System

A production strategy where products are manufactured based on anticipated demand, pushing them through to the end of the production line.

Pull System

A production strategy that relies on demand-driven production where products are only made when there is a customer demand, to reduce waste.