More and more devices are being introduced into the market that perform tasks similar to that of PCs, such as tablets and smartphones. At the same time, the price of computer chips to make high-end PCs continues to fall. What is the effect of the events on equilibrium price and quantity of high-end PCs?
A. Price falls continuously as does quantity sold.
B. Price falls continuously while quantity falls initially but then rises, recouping earlier losses.
C. Price rises then falls while quantity sold falls continuously.
D. Price falls continuously and quantity rises continuously.
Answer: B
You might also like to view...
How does scarcity affect the range of possible choices that decision makers face?
A. It narrows the choice to a single option. B. It narrows the range of choices. C. It increases the possible methods for solving problems. D. It clarifies the choices by highlighting the best solutions. E. It simplifies the choices and therefore widens the range.
In the long-run, both perfectly competitive and monopolistically competitive firms will produce at minimum average cost
a. True b. False
An example of a good that can be used for money that has intrinsic value is:
A. cigarettes. B. fish. C. gold. D. All of these have intrinsic value.
The most widely used approach for the analysis of oligopoly behavior is
a. game theory. b. role playing. c. strategic engineering. d. input-output analysis.