In 2012 Nike reduced the price of its running shoes by 20 percent. As a result, the substitution effect caused
A) the demand for Nike shoes to increase.
B) people to switch from Adidas shoes and buy more Nikes.
C) the relative price of Nikes to increase.
D) the demand curve for Nikes to shift rightward.
B
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In the following index: 2003 = 123.3; 2004 = 145.3; 2005 = 111.4; 2006 = 100; 2007 = 94.3, what is the rate of change from 2006 to 2007?
a. 5.7% b. 5% c. 4.3% d. 2.5% e. unable to determine
To maximizes profits, what price should ATC Communication charge?
The table below shows the demand curve and cost information for ATC Communication, a firm that is a monopoly.
a. $600
b. $800
c. $400
d. $200
In traditional economic models, the narrowly self-interested, well-informed, highly disciplined and cognitively formidable decision maker is often referred to as:
A. homo economicus. B. a boundedly rational agent. C. a behavioral economist. D. a satisficer.
The difference between a private good and a public good is that
A. private goods are government-sponsored goods while public goods are government-inhibited goods. B. private goods make us happy while public goods do not. C. externalities are always created in the production process but not in the production of public goods. D. the exclusion principle applies to a private good but not to a public good.