Circle of Crust Pie Five Pizzas has a frequent purchaser program, called Circle of Crust, in which patrons earn points with every purchase. With enough points, the patron's next purchase is free. How does this program alter customer decisions?
This is a form of a volume discount. Under the program, customers face a lower marginal cost of future pizzas. This lowers the price for the pizzas and induces them to make more purchases than they would otherwise.
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The market for electricians in a small town might have a different structure than in a large city because
A) cartels are legal in large cities but not in small towns. B) the small town market can only support a few electricians. C) unions are stronger in large cities than in small towns. D) None of the above.
The main tradeoff to be considered when judging pro-growth policies is
a. foregone current consumption versus the current benefits of technological progress b. foregone current consumption versus the future benefits of technological progress c. foregone future consumption versus the future benefits of technological progress d. foregone future consumption versus the current benefits of technological progress e. government surpluses versus deficits in the future
If Mexico has a comparative advantage in oil compared to the U.S., it means that the opportunity cost of producing oil in Mexico is
a. relatively high b. relatively low c. zero d. infinite e. higher than in the U.S.
When demand rises and supply remains the same, equilibrium price _______ and equilibrium quantity ____________.
Fill in the blank(s) with the appropriate word(s).