Suppose that a firm successfully introduces a highly profitable new product. If this new product is priced higher than existing substitute products, then the:
A. new product has greater marginal utility than the existing products.
B. laws of economics have been violated.
C. new product must have increasing, not diminishing, marginal utility.
D. existing products were unprofitable to produce.
Answer: A
Economics
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Refer to Figure 12-5. If the market price is $20, what is the amount of the firm's profit?
A) $5,400 B) $6,750 C) $8,100 D) $16,200
Economics
Consider a world with two income earners and an income tax. Individual A earns $25,000 and pays $1,000 in taxes. Individual B earns $100,000 and pays $4,000 in taxes. Which of the following best classifies the income tax system in this world?
a. proportional b. progressive c. regressive d. sumptuary
Economics