Jill consumes nothing but soup and cola. If cola is a luxury good for Jill, then soup must be a necessity
Indicate whether the statement is true or false
True . The weighted sum of income elasticities must sum to one. Because the income elasticity of cola is >1, the income elasticity of soup must be <1.
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Which of the following is FALSE?
a. To reduce cannibalization among products, reposition a product so that it does not directly compete with the other b. After acquiring a substitute product, raise prices on both the products c. After acquiring a complementary product, raise prices on both the products d. All of the above
To maximize profit, a monopsonist hires workers up to the point at which marginal factor cost (MFC) equals marginal revenue product (MRP)
a. True b. False Indicate whether the statement is true or false
Which one of the following was NOT a reason why Brazil's infant industry protection of its personal computer industry was a failure?
a. Imported silicon chips were expensive to obtain. b. Local regulations limited the entry of new firms in the industry. c. Domestically produced parts required by the Brazilian PC industry were expensive. d. The Brazilian government continued to purchase imported PCs.
Assume the price of Nikes decreases. As a result, consumers increase the quantity of Nikes purchased each year and purchase fewer Reeboks. This is an example of the:
A. substitution effect. B. income effect. C. utility effect. D. consumption effect.