A black market may occur when
A) the government imposes a price floor below the market clearing price.
B) the government imposes a price ceiling below the market clearing price.
C) the government imposes a price ceiling above the market clearing price.
D) the government does not impose either a price ceiling or a price floor.
B
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Which of the following will improve your bargaining position when contracting with a supplier
a. Your supplier merges with an another large supplier of the same product b. You redesign your product to be more feasibly accepting of many suppliers' parts c. You redesign your product so that your preferred supplier is more integral to product success d. Your supplier's chief competitor has exited the market
The economic value which can be created by a transaction between two people, Ed (seller) and Luis (buyer), is $50 as Ed's opportunity cost of selling is $135 and Luis' valuation of the good is $185 . If each gains $25 from this transaction, which of the following conclusions can be drawn?
a. Transaction costs are zero. b. Luis has higher bargaining power than Ed. c. Ed has higher bargaining power than Luis. d. Transaction costs are positive.
An example of “cream skimming” is when
A. a firm charges the same price to all consumers, even though costs for some are higher. B. a firm offers a reduced price to the best-paying customers of their competitors. C. a firm offers a reduction in price on a package sale of two items. D. All of these are examples of “cream skimming.”
Between 1986 and 2015, while the general price level increased by 116%, drug prices
A. rose by 136%. B. rose by 55%. C. rose by 552%. D. rose by 268%.