Shopping at a warehouse, such as Sam's Club or Costco, allows its members to pay very low prices on the goods and services they buy. Customers who shop at such a store incur:
A. transaction costs because they must be members to shop there.
B. no transaction costs because they pay prices that are lower than any other location.
C. transaction costs because they must buy a product in bulk.
D. no transaction costs because members can return any item purchased for any reason.
Ans: A. transaction costs because they must be members to shop there.
You might also like to view...
In 1989, Hurricane Hugo devastated Charleston, South Carolina, leaving residents with no electricity for light or refrigeration, and completely cut off from the outside world by fallen trees and washed-out roads. Consequently, the price of ice rose 1,000 percent and generators 300 percent. Tree removal firms were charging $4,000 to cut up a single tree. Outraged, the city government enacted an
emergency law prohibiting price "gouging." This law is an example of a. the cost disease of services. b. a price ceiling. c. the laissez-faire rule. d. the indispensable necessity syndrome.
Which of the following individuals would most likely be helped by a price floor?
a. a major league baseball player seeking a new contract b. a lawyer earning enough to pay for his daughter’s college tuition c. a business person seeking a significant raise d. a teenager looking for a minimum-wage summer job
When the growth rate of the economy slows we would expect:
A. the risk spread to increase more between Aaa and Baa securities than U.S. Treasuries and Aaa securities. B. the risk spread to increase more between U.S. Treasury Securities and Aaa securities than between Aaa and Baa securities. C. the risk to increase for U.S. Treasury securities. D. investors to purchase more junk bonds in search of a higher yield.
The basic characteristic of the short run is that:
A. a firm does not have sufficient time to change the amounts of any of the resources it employs. B. the firm does not have sufficient time to cut its rate of output to zero. C. barriers to entry prevent new firms from entering the industry. D. the firm does not have sufficient time to change the size of its plant.