The hedonic price method
a. is a direct method of estimating benefit
b. relies on the theory that goods are valued for their attributes
c. is a physical linkage approach
d. is useful but not intuitive
b. relies on the theory that goods are valued for their attributes
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Some economists have suggested that network externalities result in consumers being locked into the use of products with inferior technologies
Economists Stan Leibowitz and Stephen Margolis have studied cases that have been cited as examples of this and found A) that consumers use products with inferior technologies when their prices are lower than products with superior technologies. B) that in all of these cases network externalities resulted in market failure. C) there is no convincing evidence that the alternative technologies were superior. D) consumers sometimes do become locked into the use of products with inferior technologies.
All other factors being constant, a reduction in price tends to cause which of the following?
A) an increase in supply and an increase in demand B) a reduction in supply and an increase in demand C) an increase in quantity supplied and a reduction in quantity demanded D) a reduction in quantity supplied and an increase in quantity demanded
If the marginal cost and average total cost of production are the same at 5,000 units, then there is no other output that has a lower average total cost
Indicate whether the statement is true or false
A profit maximizing monopolist sets output where
A. MC = demand. B. MC = MR. C. MC = P. D. it depends on the average costs in each case.