On November 7, 1996, the Distilled Spirits Council of the United States decided to end its voluntary ban on television and radio liquor advertisement. The ban on hard liquor advertising had been in effect since 1936 for radio and 1948 for television
Did the lifting of this ban likely increase or decrease the profits of hard liquor companies? Briefly explain.
If advertising is a prisoner's dilemma, then lifting the ban on advertising hard liquor on television and radio likely decreased the profits of hard liquor companies following the lifting of the ban.
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Which of the following activities are production?
A) combining flour, milk, and eggs to make cookies B) moving crude oil from one part of Texas to an oil refinery near the Texas coast C) taking ice cubes from a tray to put in a drink D) All of the above are production.
Consider a risk-averse individual whose initial situation is a risk-free basket of outcomes. How does this person react when he is offered a wager at favorable odds?
a. He always declines the wager. b. He always accepts the wager. c. He accepts the wager only if it is sufficiently small. d. He accepts the wager only if it is sufficiently large.