If grocery stores in high-crime areas charge higher prices than stores elsewhere, it is because
A) each item sold must bear its share of the higher insurance costs.
B) residents of high crime areas tend to be less price-conscious shoppers.
C) the costs of crime are a legitimate cost of doing business.
D) the store owners are not setting marginal cost equal to marginal revenue.
E) there is less competition between stores in high-crime areas.
E
You might also like to view...
An example of the outlet substitution bias in the calculation of the CPI is a price increase in
A) a trip to Mexico for a couple that had previously taken vacations in Europe. B) a 2014 Honda Civic relative to a 2004 Honda Civic. C) GPS units versus AAA map books. D) textbooks bought through the campus bookstore relative to textbooks via Craigslist. E) olive oil versus vegetable oil.
The fraction that banks must, by law, hold as reserves against the checking deposits of their customers is called the
a. federal deposit insurance premium. b. vault cash quota. c. excess reserve requirement. d. required reserve ratio.
In the long run, if inflation is higher in India than in the U.S., one would expect
A. the dollar to depreciate relative to the rupee B. the rupee to depreciate relative to the dollar C. the rupee to appreciate relative to the dollar D. two of the above are correct
The simple circular flow model shows that workers and capital owners offer their services to firms through the
What will be an ideal response?