Combining related functions (e.g. running a hotel and a restaurant) increases efficiency and reduces costs. What is this called?

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competitive economy

economy of reduction

economy of scope

economy of scale

Revenue - Cost = _____

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Profit

Income

Value

Sales

What is the underlying assumption in any demand curve?

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Demand curves can be accurately constructed for all customers.

In the real world, the exact shape of a demand curve is known.

For any given price, there is a certain demand.

You own one of the two similar ice cream shops in the same neighborhood. You want to utilize game theory to set your prices. What challenge does game theory allow you to address?

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When using game theory, your action will not lead to a price war.

You do not know what your competitor will do.

Lowering your price will always result in higher profit.

Give explanation