Firms seek to differentiate their product
A) to avoid state and federal regulation.
B) to create an illusion of value.
C) to strengthen their demand and to make it more inelastic.
D) to strengthen their demand and to make it more elastic.
C
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Refer to Budget Lines. If the consumer purchased basket B last year and purchases basket C this year, we can conclude that
a. the consumer is not behaving optimally.
b. the consumer's tastes changed between this year and last year.
c. the consumer's indifference curves cannot be convex.
d. the law of demand does not hold for this consumer.
What does the term "commitment" refer to in game theory?
What will be an ideal response?
Recently, the State of Tennessee discovered chemical compounds in their drinking water which may cause cancer. Since Tennessee's drinking water comes from the Pigeon River in North Carolina, the source of these chemicals is the waste discharges of industrial paper plants in North Carolina. This is an example of a(n):
a. external cost imposed on the citizens of Tennessee by the industrial plants of North Carolina. b. market failure where the market price of the output of these industrial plants does not fully reflect the social cost of producing these goods. c. externality where the marginal social costs of producing these industrial goods differ from the marginal private costs. d. all of these.
The price of one currency in terms of another is referred to as the:
a. exchange rate. b. purchasing power. c. comparative price. d. real price.