A leading game-console manufacturer slashes the price of its flagship product by ten percent. Holding other things such as income and preferences constant, which of the following is the most likely group behavior prediction?
a. Price reduction will have no impact on purchase patterns
b. Price reduction will be associated with a reduction in quality; thereby reducing sales.
c. More game consoles will be sold at lower prices.
d. Group behavior cannot be predicted.
c
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In a period of hyperinflation, the velocity of circulation increases because
A) the real interest rate rises. B) households and firms spend money as soon as they receive payment. C) the nominal interest rate decreases. D) money is valuable everyone wants it. E) potential GDP increases.
A firm's opportunity cost of using resources provided by the firm's owners is called:
a. sunk costs. b. fixed costs. c. explicit costs. d. implicit costs. e. entrepreneurial costs.
Which of the following reduces the interest rate?
a. an increase in government expenditures and an increase in the money supply b. an increase in government expenditures and a decrease in the money supply c. a decrease in government expenditures and an increase in the money supply d. a decrease in government expenditures and a decrease in the money supply
Which of the following represents the largest share of U.S. gross domestic product (GDP)?
A) services B) agricultural production C) the production of manufactured goods D) the production of physical goods E) the production of capital goods