Firm a Has Price Elasticity of Demand of -1

question 63

Multiple Choice

Firm A has price elasticity of demand of -1.5 and a marginal cost of $30. Firm B has a price elasticity of demand of -2.0 and a marginal cost of $30. The profit-maximizing price for Firm B is $____.

• A) 100
• B) 90
• C) 70
• D) 60

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Definitions:

Externally Leak

A situation where fluids escape from their intended system through cracks, loose connections, or damaged components, visible on the exterior of the machinery.

Brake Fluid

A type of hydraulic fluid used in brake systems to transfer force into pressure, facilitating the braking process.

Rear Brake Adjustment

The process of modifying the rear brakes of a vehicle to ensure they engage properly and perform optimally.

Stop Lights

Visual signaling devices at the rear of a vehicle designed to illuminate in red to indicate when the vehicle is braking.