Consider the Following Table -Suppose That the Price of Each Input Increased from $5

question 75

Multiple Choice

Consider the following table:

$\begin{array}{|l|l|}\hline \text { Input Quantity } & \text { Real Output } \\\hline 100 & 200 \\\hline 150 & 300 \\\hline 200 & 400 \\\hline\end{array}$
-Suppose that the price of each input increased from $5 to $8.The per-unit cost of production in this economy would:

• A)rise by $1.50, and the aggregate supply curve would shift to the right
• B)rise by 60 percent, and the aggregate supply curve would shift to the left
• C)rise by 60 percent, and the aggregate demand curve would shift to the right
• D)fall by $1.50, and the aggregate demand curve would shift to the right
• E)rise by 35 percent, and the aggregate demand curve will shift to the left

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Definitions:

Profit-Maximizing Price

The price level at which a company can sell its product or service to maximize its profit.

Specific Firm

A distinct company or business entity recognized for its unique product, service, or brand identity.

Monopolistically Competitive

A market structure characterized by many firms selling products that are similar but not identical, allowing for significant influence over prices.

Long-Run

A time period in which all factors of production and costs are variable, allowing for the adjustment of all inputs.