Which of the following is used to explain why a consumer's willingness to buy a cell phone increases as the number of other people who own and use cell phones increases?
A) network externalities
B) market failure
C) diminishing marginal utility
D) the income effect of a price change
Answer: A
You might also like to view...
What is the opportunity cost of going from point A to point B?
Under the fixed rate regime foreign countries could hold their dollar exchange rates constant by
A) using tight monetary policy. B) using expansionary fiscal policy. C) negotiating with the central bank of the United States. D) setting their domestic interest rate equal to the U.S. interest rate. E) holding their exchange rates constantly pegged to the euro and yen.
If producers must obtain higher prices than before to produce a given level of output, then the following has occurred:
A. A decrease in demand. B. An increase in demand. C. A decrease in supply. D. An increase in supply.
When Lucian starts his new job, he is given the option to contribute to his retirement fund, which the company will match up to 5 percent of his base salary. Lucian knows he can afford to contribute to his retirement fund; he only needs to file a form to
activate the contributions and matching. According to prospect theory, if Lucian is typical in his behavior, we would expect him to: A. take full advantage of the matching contribution because that would maximize his financial well-being. B. not file the form to start the contribution and match. C. negotiate with his boss for a higher match in order to increase his returns. D. only start contributions if the retirement portfolio is heavily weighted in high-return assets.