Frequent-guest rates offered by hotel chains are an attempt to
a. decrease competitors' access to distribution channels.
b. develop a cost advantage independent of scale.
c. increase customers' switching costs.
d. overcome the perishability of the hotel "product."
Ans: c. increase customers' switching costs.
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If the average cost curve is downward sloping, then
a. marginal cost is smaller than average cost. b. the marginal cost curve is also downward sloping. c. there are increasing marginal returns to labor. d. wages and other input prices are falling.
Refer to Table 2-2. Assume Nadia's Neckware only produces ascots and bowties. A combination of 8 ascots and 18 bowties would appear
A) along Nadia's production possibilities frontier. B) inside Nadia's production possibilities frontier. C) outside Nadia's production possibilities frontier. D) at the horizontal intercept of Nadia's production possibilities frontier.
Which of the following is an economic investment?
A. Shares of corporate stock. B. U.S. savings bonds. C. Newly built houses. D. Bonds issued by private corporations.
A perfectly competitive firm shuts down if the price of its product is
A) greater than its minimum average variable cost. B) less than its minimum average variable cost. C) greater than its maximum variable cost. D) less than its minimum total cost.