Assume that a product upgrade strategy adopted by a microwave oven manufacturer increases his marginal cost by $1.50 . If the strategy also increases the demand for the product by $3.50 per unit, total economic value will increase
Indicate whether the statement is true or false
T
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If the incentive to take advantage of a conflict of interest is high
A) removing the economies of scope that created the conflict may induce higher costs because of the decrease in the flow of reliable information. B) then the government must step in to remove the conflict. C) the costs of non-action in removing the conflict will always be higher than the cost of removing the conflict. D) firms will always step in and work to remove the conflict.
If lenders think that a particular borrower might default, they will demand a:
A. higher interest rate to make it worth taking that risk. B. lower interest rate to make it worth taking that risk. C. higher interest rate to decrease the amount of risk incurred. D. lower interest rate to decrease the amount of risk incurred.
The Coase theorem will hold only if:
A. there are no transactions costs. B. people can make enforceable agreements. C. Both of these must hold true. D. Neither of these must hold true.
An increase in per capita production and incomes can be expected to have a large effect in reducing emissions that lead to global warming.
Answer the following statement true (T) or false (F)