Firms are better off using rebates rather than just lowering the price of a good because
A) people view the firm in a positive light because now poorer people will be able to afford their good.
B) customers overestimate the value of the rebate and so buy more of the good, making profits higher than if they just lowered the price.
C) only those who place a low value on their time or are price sensitive actually redeem the rebate, making profits higher than if they just lowered the price.
D) lowering the price is inefficient and creates additional deadweight loss.
C
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The symmetry-integration diagram shows a set of situations under which a nation should fix or float. There is a set of combinations of integration and symmetry beyond which the benefits of fixing outweigh the costs. This is shown as:
A) a positively sloped line from the origin, equidistant from both axes. B) a negatively sloped line, above which a nation should fix and below which a nation should float. C) a curved line that follows a random path through the space, coming close but never touching either axis. D) a curved line, the slope of which is at first negative, then increases at an increasing rate as the benefits of fixing increase exponentially
If the price level rises but the money wage rate does not, then firms will hire ________ labor and the quantity of real GDP supplied will ________
A) more; increase B) the same amount of; not change C) less; decrease D) more; not change E) less; increase