Which of the following has been a significant factor in DVDs replacing video cassettes (VCs) in the retail home video market?
A) DVDs are now less than one-half the price of VCs.
B) A scarcity of production capacity has curtailed the manufacture of VCs.
C) Most consumers perceive DVD sound and video reproduction to be of higher quality.
D) The price of DVD players has increased dramatically.
Answer: C) Most consumers perceive DVD sound and video reproduction to be of higher quality.
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If the consumption of sugar does not change at all following a price increase from 50 cents per pound to 65 cents per pound, the demand for sugar is considered to be
A) relatively inelastic. B) perfectly elastic. C) perfectly inelastic. D) unitary elastic.
A firm's demand for labor is known as a "derived demand" because
a. the firm gains utility from hiring more labor. b. the amount of labor hired depends upon how much output the firm can sell. c. the wage rate paid to workers is derived from the market for labor. d. it is derived from the demand for capital.