When product A is a substitute for product B, the cross-price elasticity of demand for products A and B will be _____
a. unity
b. negative
c. positive
d. decreasing
e. increasing
c
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The government of Techland is planning a cut in income tax rates. What is the possible consequence of such a change in policy on Techland's economy if it is implemented?
What will be an ideal response?
Which of the following is an outcome of advertising for a monopolistically competitive firm? a. Long-run average costs shift downward
b. The firm's demand curve becomes flatter and shifts inward. c. The firm's demand curve keeps the same slope and shifts inward. d. Long-run average costs shift upward.
A promoter might charge less than the profit-maximizing ticket price because
A. ticket profits are not everything, the total profit may be enhanced by on-site memorabilia sales. B. the talent may want to create a reputation for charging fair price so as to get more fans in the future. C. the talent that they represent may wish to play to a full arena for their own ego. D. all of the options are correct.
Concern about the ability of independent foreign firms to maintain product quality
A. is an inherent disadvantage faced by the multinationals. B. makes FDI preferable to licensing firms in the foreign markets. C. makes licensing firms in the foreign markets preferable to foreign direct investment (FDI). D. often results in the formation of a license agreement between a foreign firm and a multinational enterprise.