Refer to Scenario 5.4. What is the pay-off of outcome C?

In order to use lock-in as a competitive strategy, firm managers should be prepared to do all of the following except:

A) invest in a given base of customers by giving concessions initially. B) avoid selling complementary products and access to the customer base. C) be the first to bring a new type of product to market. D) use loyalty programs as part of an entrenchment strategy.

The Slutsky equation shows that, holding the total effect constant, the income effect will be larger for goods that

A) have a smaller substitution effect. B) make up a larger percentage of a household's budget. C) have perfectly inelastic demand curves. D) All of the above.