Suppose Orange Inc sells MP3 players and initially has monopoly power because there are only a few close substitutes available to consumers
As more types of MP3 players are introduced into the market, the demand facing Orange becomes ________ elastic and the Lerner index achieved by the firm in this market ________. A) less, declines
B) less, increases
C) more, declines
D) more, increases
C
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There has been catch-up among ________, but there has not been catch-up among ________
A) developing countries such as Niger; industrialized countries such as Japan B) developing countries such as Niger; all countries of the world C) industrialized countries such as Japan; all countries of the world D) all countries of the world together; industrialized countries such as Japan
If Lake Boats charges an annual membership fee of $1,200 for the use of a boating slip (a place to store a boat) and charges a $50 fee each time a member docks their boat, this is an example of ________.
A) two-part pricing B) an all-or-nothing offer C) a single pricing scheme D) commodity bundling
Refer to Figure 6.6. What area represents the compensation for reduced consumption that results from an increase in the price of gasoline from $1.75 to $3.00 per gallon?
A. a + b
B. a + b + e
C. c + d + e
D. d + e
Exhibit 4-2 Supply and demand curves
In Exhibit 4-2 an increase in supply would cause a movement from which equilibrium point to another, other things being equal?
A. E1 to E2. B. E1 to E3. C. E4 to E1. D. E3 to E4.