Planning a vacation at a beach resort, Joey found that hotel prices jumped during the peak summer season, with Fourth of July week being the most expensive of all. Which of the following best explains the seasonal price increase?
a. As demand falls in the summer, the hotel raises room rates to stay profitable.
b. The resort raises prices to reduce occupancy during the busiest holiday periods.
c. Higher demand drives up prices in the summer as more people take vacations.
d. Resorts raise prices in the summer to make people feel their vacation is exclusive.
c. Higher demand drives up prices in the summer as more people take vacations.
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All of the following will affect the position of the demand curve EXCEPT
A) income. B) taste and preference. C) changes in expectations of future relative prices. D) prices of resources used to produce the product.
The marginal rate of substitution measures
A. the consumer's willingness to substitute one product for another so that marginal utility will remain unchanged. B. the consumer's willingness to substitute one product for another so that total utility will remain unchanged. C. the changes in marginal utility along the indifference curve. D. the impact of product substitution.
The profit maximizing combination of resources
A. is also the cost minimizing combination of resources. B. usually involves hiring more of some resources and less of other resources than the cost minimizing combination of resources. C. usually involves less of each input hired than the cost minimizing combination of resources. D. usually involves more of each input hired than the cost minimizing combination of resources.
For a single-price monopolist, price is ________ marginal revenue
A) less than B) greater than C) equal to D) less than or equal to but never more than