Which of the following is an example of the endowment effect?
A) A consumer places a higher value on a good currently owned as compared to a good they are considering purchasing.
B) A consumer uses a portion of income in order to provide income to future generations.
C) As a consumer's income increases, they increase consumption of most goods.
D) Consumers will tend to value objects the same for buying and selling.
A
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Danielle Ocean pays for monthly pool maintenance for her home swimming pool. Last week the owner of the pool service informed Danielle that he will have to raise his monthly service fee because of increases in the price of pool chemicals
How is the market for pool maintenance services affected by this? A) There is a decrease in the demand for pool maintenance services. B) There is a decrease in the quantity of pool maintenance services supplied. C) There is an increase in the supply of pool maintenance services. D) There is a decrease in the supply of pool maintenance services.
If a perfect competitor is currently charging $9 for its product and the marginal cost of the last unit produced is $6, the firm should
a. cut back production and increase price b. stay at its current price and output level c. increase price and output d. increase price and hold output constant e. increase output