Basic Economic Concepts

There is not enough information to determine the effect on total revenue without knowing supply elasticity.

Total revenue will decrease because the percentage increase in quantity demanded is smaller than the percentage decrease in price.

Total revenue will remain unchanged as the effect of lower price balances out with higher quantity sold.

Total revenue will increase because consumers will buy more at lower prices.

Consumers lose all trust in dining out, causing widespread closures across the restaurant industry.

Random health inspections completely stop since restaurants now have clear financial disincentives for failures.

Restaurants increase menu prices significantly to cover fines as part of regular business expenses even without failing inspections.

Restaurants improve cleanliness standards proactively out of fear facing penalties affecting profitability.

They may aim marketing efforts at consumers with rising incomes.

They may not change production levels, expecting demand stability regardless of income changes.

They may increase production rapidly expecting consistently high demand growth.

They may reduce prices significantly during economic downturns.

Increased differentiation among products

Decrease in average total costs as output increases

Fluctuation depending upon market demand

Increase proportionally with an increase in all inputs

An increase in producer surplus due to the subsidy received.

Decreased market supply of solar panels due to producers leaving the market.

Lower price for consumers purchasing solar panels.

A potential overallocation of resources towards the production of solar panels.

Consumer surplus may either increase or decrease depending on consumers' valuation of differentiation versus lower prices.

Consumer surplus remains unchanged as long as total output across all firms is constant.

Consumer surplus decreases because monopolistic competitors can charge prices above marginal cost due to brand loyalty.

Consumer surplus always increases due to enhanced product variety catering to individual preferences.

Average revenue and average cost

Marginal benefit and marginal cost

Total benefit and total cost

Fixed costs and variable costs

Firms innovating new technologies to reduce emissions and sell unused permits for profit.

Companies opting to buy additional permits rather than investing in cleaner technology over time.

A gradual reduction in total emissions as firms become more efficient and pollution declines.

The creation of a market for emission permits that encourages cost-effective pollution reduction strategies among companies.

Lower firm profits versus increased government revenue from fines.

Immediate reduction in pollution versus higher product prices for consumers.

Short-term job loss versus long-term environmental sustainability.

Increased public health costs now versus reduced healthcare spending later on.

The labor costs associated with farming activities.

The price of corn seeds purchased for planting.

The profits that could have been made from planting wheat.

The water and fertilizers used for growing corn.