Consider a consumer who is searching for the lowest price for good X. The consumer knows that 75 percent of the time she will find a store charging $10 and 25 percent of the times she will find a store charging $7. The expected benefit from an additional search is:
A. $0.
B. $2.25.
C. $3.
D. $0.75.
Answer: D
Economics
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As long as there are fixed resources, diminishing marginal returns will never exist
a. True b. False Indicate whether the statement is true or false
Economics
Exhibit 30-4
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Refer to Exhibit 30-4. If a negative externality exists, then the market ____________output by the amount ________________.
A. overproduces; Q1 B. underproduces; Q2 C. overproduces; Q1 - Q2 D. underproduces; Q2 - Q1
Economics