Some luxury product manufacturers will purposefully raise prices on their goods in order to reduce sales volume
This strategy may successfully increase sales revenue if the luxury goods are subject to the ________ effect and have relatively ________ demand. A) bandwagon, elastic
B) bandwagon, inelastic
C) snob, elastic
D) snob, inelastic
D
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Assume that the characteristic functions for individuals 1,2, and 3 are given by V(1) = $20, V(2) = $16, and V(3) = $10 respectively, and value created by the coalition V(1,2,3) = $60 . If the payoff to individual 1 is $30, and that to individuals 2 and 3 is $15 each, which of the following statements is true?
a. The given allocation is within the core. b. 2 and 3 will withdraw from the coalition. c. 2 will block the imputation. d. This allocation is individually rational for all.
A bakery would be willing to supply 500 bagels per day at a price of $0.50 each. At a price of $0.80, the bakery would be willing to supply 1,100 bagels. Using the midpoint method, the price elasticity of supply for bagels is about
a. 0.62. b. 0.77. c. 1.24. d. 1.63.