The Following Question Are Based on the Following Graph

question 31

Multiple Choice

The following question are based on the following graph:

-For this firm profits are maximized at an output rate of

• A) 0Q.
• B) 0P.
• C) 0W.
• D) 0U.
• E) 0V.

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Definitions:

Price Elasticity

A measure indicating the extent to which the demand for a merchandise changes following a price adjustment.

Short Run

A period in economics during which at least one input is fixed and cannot be changed by the firm.

Long Run

A period in which all factors of production and costs are variable and companies can enter or exit an industry.

Demand

The quantity of a product or service that consumers are willing and able to purchase at various price levels at a given time.