Albatross Software has two main products: WindSong is a program that can be used to edit audio files and SunBurst is a program that can be used to edit digital photos. The two major types of customers are small businesses and home users
The small business customers have a reservation price of $300 for WindSong and $450 for SunBurst. The home users have a reservation price of $100 for WindSong and $125 for SunBurst. Which of the following statements is true? A) Bundling the two software products is not likely to be profitable because the marginal cost of producing software is positive by very small.
B) Bundling the two software products is not likely to be profitable because the consumer demands are homogeneous.
C) Bundling the two software products is likely to be profitable because the demands are negatively correlated.
D) Bundling the two software products is not likely to be profitable because the demands are positively correlated.
D
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An increase in spending of $25 billion increases real GDP from $600 billion to $700 billion. The marginal propensity to consume must be ____ and the multiplier is ________.
A. 0.25;4 B. 0.75;4 C. 0.80;5 D. 0.50;2
If the price of a good rises, supply will
A. increase. B. decrease. C. not change. D. the answer depends upon the demand in the market.
If the quantity of soccer balls demanded is represented by the demand equation QD = 80 - 2P, then to solve for the price of soccer balls, the equation would be rewritten as
A) P = 40 - 0.5QD. B) P = 1.6QD + 80. C) P = 80 - QD. D) P = QD + 160.
Which of the following does NOT describe the relationship between banks and small business during the 2000s (prior to the financial crisis)?
A) Banks typically applied fixed guidelines for granting loans, leaving little room for personal judgment. B) Fewer small businesses received loans as banks shifted their focus to mortgages. C) Many small businesses were receiving loans from regional and national banks. D) More banks became convinced that it would be profitable to loosen their loan guidelines to make more borrowers eligible to receive credit.