Related to the Economics in Practice on page 267: When trying to determine the price of a new product, firms sometimes price the product close to the prices of similar products in the market. Firms call this approach
A. price rationing.
B. benchmark pricing.
C. focus group pricing.
D. test market pricing.
Answer: B
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Refer to Figure 2-10. If the economy is currently producing at point A, what is the opportunity cost of moving to point B?
A) 46 thousand forks B) 60 thousand spoons C) 16 thousand spoons D) 12 thousand forks
For society as a whole, producing more of one good or service has an opportunity cost because
a. human wants are limited and resources are unlimited b. both human wants and resources are unlimited c. resources are limited; human wants are irrelevant d. human wants are unlimited and resources are limited e. both human wants and resources are limited
If the price of a soda is $0.50, and the marginal utility of the first soda consumed is valued at $2, then the consumer surplus of that first soda is
a. $0.50 b. $1.50 c. $2.00 d. $2.50 e. $4.00
If the dollar appreciates and the U.S. AD curve shifts leftward by an amount greater than the U.S. SRAS curve shifts rightward, then Real GDP will _____________________ and the price level will _____________________
A) decrease; decrease B) decrease; increase C) increase; decrease D) increase; increase