The Wells Fargo Bank Tower in downtown Los Angeles displays a sign at its parking entrance that clearly shows that the per-hour parking charges are higher for people who visit the building for a short while. How is this consistent with the general principle of price discrimination?
A document courier whose customers want quick pickup and delivery wants to stay for only the short time required to visit a customer's office. Even if a cheaper lot is only a block away, there will be a 15-minute round-trip walk to Wells Fargo. Hence he is an inelastic demander of space in this particular building and is willing to pay a higher price to save time.
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Which of the following is not a characteristic of a battle of the sexes game?
A) Each player has a dominant strategy. B) Nash equilibria exist at every outcome where the players successfully coordinate. C) The two general outcomes are where players either coordinate with one another or they do not. D) The payoff for coordinating is higher than the payoff for not coordinating.
The above figure shows the cost curves for a competitive firm. If the market price is $15 per unit, the firm will earn profits of
A) $0. B) $4. C) $40. D) $160.
Which of the following is not a principal-agent relationship?
a. Adam and Gloria get married. b. Payless, Getless, Inc., hires a salesperson. c. Dixie hires a lawyer. d. Citizens elect a state senator. e. Opal gets her car repaired.
People are more likely to purchase a consumer ratings magazine that reviews new automobiles before buying a new car than they are to purchase a consumer ratings magazine that reviews pens and pencils before buying a new pen or pencil. Which of the following best explains this behavior?
a. Because the consumer ratings magazine must have a higher price for the issue reviewing pens and pencils. b. Because the value of the information, in terms of avoiding a mistake on the purchase, is much higher for an automobile than for a pen or pencil, it is more worthwhile to gather this information. c. Because people generally do not know which products are reviewed by these consumer magazines. d. None of the above explain this behavior.