Refer to the table below. If the world price is $5.00, there will be:
Use the following table for Country X to answer the question below. Column 1 of the table is the price of a product. Column 2 is the quantity demanded domestically (Qdd) and Column 3 is the quantity supplied domestically (Qsd).
A. A domestic surplus of 100 units that will be exported
B. A domestic shortage of 100 units that will be imported
C. A domestic surplus of 200 units that will be exported
D. Neither a domestic surplus nor a shortage
C. A domestic surplus of 200 units that will be exported
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Substitution of one commodity for another depends on all of the following factors, EXCEPT:
a. prices of the goods available to the consumers. b. tastes and preferences of the buyers. c. the information buyers possess. d. market protocols.
Answer the following statements true (T) or false (F)
1. The "hedonic treadmill" of prospect theory suggests that if people's incomes rise and stay at the new higher level, then their feelings of satisfaction also rise and stay at the new higher level. 2. The anchoring effect suggests that when people are made to think of large abstract numbers before they go shopping, many of them will subsequently be willing to pay higher prices for stuff. 3. The endowment effect makes people value things less when they think of those things as their own as opposed to identical things that are not theirs - as in "grass is greener on the other side". 4. "Loss aversion" helps explain why people buy insurance policies with lower deductibles even though the policies are more expensive. 5. The status quo effect suggests that giving people more options is always good for them.