Which of the following would lead to an increase in the demand for computer software?
a. A decrease in the price of computer software.
b. A decrease in the price of personal computers.
c. An decrease in the cost of producing computer software.
d. An decrease in personal income.
b
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The host at a party offers Justin a sixth beer. Justin says, "No thanks, man. The marginal utility of that fifth beer was, like, 20 cents, but the marginal utility of the sixth would be minus 10 cents." If Justin consumes the sixth beer, his total utility will
a. rise by 10 cents. b. reach a plateau and remain constant. c. fall by 10 cents. d. fall below his marginal utility.
Which of the following is a characteristic of monopolistic competition?
a. ownership of a key resource by a single firm b. free entry c. identical product d. patents
A country's trade balance will fall if
a. either investment or saving rise. b. either investment falls or saving rises. c. either saving falls or investment rises. d. either investment or saving fall.
In the 1920s and 1930s, economists became increasingly aware that there were industries that did not fit the model of perfect competition or pure monopoly. Two separate theories of monopolistic competition resulted. Edward Chamberlin of Harvard published the Theory of Monopolistic Competition in 1933. Chamberlin defined monopolistic competition as
A. a relatively large number of producers offering similar but differentiated products. B. a market situation in which a large number of firms produce identical products. C. a relatively small number of producers offering similar but differentiated products. D. a market situation in which a small number of firms produce similar products.