Anchoring occurs when:
A. someone's choices are linked to prominent but patently irrelevant information.
B. someone's choices are linked to prominent and relevant information.
C. someone's choices are made in the absence of relevant information.
D. someone's choices are based solely upon proven and relevant information.
A. someone's choices are linked to prominent but patently irrelevant information.
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Which statement is correct regarding allocative efficiency in monopolistic competition?
a. When new competitors enter a monopolistically competitive industry, the demand curve for each firm will shift to the left. b. When new competitors enter a monopolistically competitive industry, the demand curve for each firm will shift to the right. c. When new competitors exit a monopolistically competitive industry, the demand curve for each firm will shift to the left. d. When new competitors enter a monopolistically competitive industry, the demand curve for each firm will not be affected.
A competitive firm has been selling its output for $10 per unit and has been maximizing its profit. Then, the price rises to $14, and the firm makes whatever adjustments are necessary to maximize its profit at the now-higher price. Once the firm has adjusted, its
a. marginal revenue is lower than it was previously. b. marginal cost is lower than it was previously. c. quantity of output is higher than it was previously. d. All of the above are correct.
Current research suggests that countries that adopt a pegged exchange rate may be more vulnerable to an exchange rate crisis
Indicate whether the statement is true or false
Differentiate between the quantity effect and price effect of a price cut by a monopoly
What will be an ideal response?