Which of the following is an example of the law of demand?
A) An increase in the price of magnetic optical disks is followed by a reduction in the amount of magnetic optical disks purchased.
B) An increase in the price of tablets is followed by an increase in the sale of tablets.
C) A decrease in the price of milk has no effect on the amount of milk consumed.
D) The amount of smartphones sold increases while the price of smartphones is constant.
Answer: A
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When airlines post prices on an electronic bulletin board at 8:00 a.m. each morning, the decision-makers are engaged in
a. a single play game b. a sequential game c. an entry decision d. a simultaneous game e. an infinite repetition game
If the price of a good falls, the marginal utility per dollar received from consuming a specific unit of that good
a. also falls b. stays the same c. rises d. will rise or fall, depending on the consumer e. remains unchanged, provided the consumer buys no more of the good
Which of the following is an example of a positive incentive? a. You expect to be grounded if your grades slip below a B average
b. You expect to receive a scholarship if your grades remain high. c. Desserts will be unavailable at the cafeteria if you arrive after 7:00 p.m. d. Campus police institute a policy of impounding cars parked in delivery zone spaces.
For a natural monopoly:
A. ATC = MC. B. ATC > MC. C. ATC < MC. D. there is no relationship between ATC and MC.