After acquiring a close substitute, to increase profits the firm must Raise prices on all the products equally
a.
b. Raise the prices only on products with high margins, while reducing prices on products with low margins
c. Raise prices only on products with high margins, while keeping prices constant on products with low margins
d. Raise prices on both the products, but raise the prices more for products with higher margins
d
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Which of the following normative criteria rejects a policy whenever there exists an alternative policy that could unanimously defeat it?
a. Majority rule. b. The efficiency criterion. c. The Pareto criterion. d. The potential Pareto criterion.
Complete Milton Friedman's famous statement, "Inflation is always and everywhere a ________ phenomenon."
A) recessionary B) discretionary C) repressionary D) monetary
In a world where capital moves rapidly across national boundaries, if a larger budget deficit leads to higher real interest rates,
a. there will be an inflow of foreign capital, which will cause the dollar to appreciate and net exports to decline. b. there will be an outflow of foreign capital, which will cause the dollar to depreciate and net exports to increase. c. there will be an inflow of foreign capital, which will cause the dollar to depreciate and net exports to increase. d. there will be an outflow of foreign capital, which will cause the dollar to appreciate and net exports to decline.
An increase in the personal income tax rate on interest income will
A. increase desired saving because the expected real after-tax interest rate falls. B. decrease desired saving because the expected real after-tax interest rate falls. C. increase desired saving because the expected real after-tax interest rate rises. D. decrease desired saving because the expected real after-tax interest rate rises.