Nike has used Michael Jordan to create the impression that Air Jordan basketball shoes are superior to any other basketball shoes. Nike is attempting to
A) differentiate Air Jordan basketball shoes from other types of basketball shoes.
B) convince consumers that Air Jordan basketball shoes are no different from other basketball shoes favored by celebrities.
C) lower the marginal cost of producing Air Jordan basketball shoes.
D) increase its profit by raising the price of Air Jordan basketball shoes.
A
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The aggregate supply curve slopes upward because firms
A. seek to maximize profits and output. B. normally can purchase inputs at fixed prices. C. employ technology, which is always fixed. D. purchase inputs whose prices rise as output rises.
A manager invests $400,000 in a technology that should reduce the overall costs of production. The company managed to reduce their cost per unit from $2 to $1.85 . After the investment has been made, the $400,000 investment is
a. Considered sunk costs, not relevant in further decision making b. Considered sunk costs, but still relevant in further decision making c. Considered a loss d. Considered a profit
Good A has a price elasticity of demand of .27, while good B has a price elasticity of demand of 2.9. To raise the most tax revenue, the government should:
A. place a unit tax on good A. B. place a unit tax on good B. C. raise the price elasticity of demand for good A. D. subsidize the production of good B.
The table above gives the total cost information for a perfectly competitive firm. What is the profit-maximizing quantity of output?
a. 4 b. 6 c. 3 d. 5