Suppose that the government subsidizes firms that produce a product -- i.e. they pay the firms for producing it. How would this affect the market for the product?

increases product supply.

reduces product supply.

reduces product demand.

increases product demand.

Suppose the cost to produce a product falls - e.g. if the price of cheese falls so that it gets cheaper to make nachos. How would this affect the market the product (in this example the product is nachos)?

Group of answer choices

the market would fall

D would fall

the market would rise

D for nachos would rise

S of nachos would rise

Suppose that D is inelastic. What does this mean?

Consumers are very sensitive to changes in price

Consumers will only buy the product if it is inexpensive

Consumers will buy more of the product if the price rises

Consumers will not change the Q they buy very much if P changes

Which of the following is true about the relationship between elasticity of demand and the impact on a firm's revenue if the firm increases the price of the product they sell? In other words, if a firm raises price, which of the following statements is true?

If demand is inelastic, revenue will go up

The answer is not clear - revenue is not related to elasticity

If demand is elastic, revenue will go up