The basic human tendency to overvalue recent experience when trying to predict the future is called:
A. tulip mania.
B. the leverage effect.
C. herd instinct.
D. the recency effect.
D. the recency effect.
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An example of a market where a Bertrand model would be NOT be plausible is the market for
A) pizza. B) sweaters. C) motorcycles. D) toothpicks.
Clark Industries currently spends 5 percent of its sales on advertising. Suppose that the elasticity of advertising for Clark is 0.25. Determine the optimal profit margin over price (P ? MC)/P.
A. 15 percent. B. 25 percent. C. 20 percent. D. None of the answers is correct.
In Figure 6.7 at equilibrium, consumer surplus is area:
A. A. B. A + B + C. C. E + F + G. D. G.
In the derivation of AVC, to find its minimum, you need
A. The flattest slope on the TC. B. the minimum-slope ray out of the origin to the A. C. the minimum-slope ray out of the origin to the TVC. D. the minimum-slope ray out of the origin to the TC.