If a good's price went UP by 20% and simultaneously demand went DOWN 5% what is the price elasticity of demand of this good?

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Part 1

A.

-4

B.

-.25

C.

4

D.

.25

Fender and Gibson are competing guitar companies and have decided to agree to fix the price of their high-end models to $7500 a guitar. Later, Gibson decides to lower the price of their high-end model to $6500 to make a short-run gain. This behavior is best described as a(n)

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Part 1

A.

Network.

B.

Cooperation.

C.

A prisoner's dilemma.

D.

Opportunistic behavior.

Jimbo consumes his first soft pretzel at Utah Jazz game and gains 50 utils of satisfaction, he decides to eat one more and soft pretzel and his total utility increases to 80. What was his MARGINAL UTILITY for the 2ND soft pretzel?

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Part 1

A.

80 utils.

B.

30 utils.

C.

40 utils.

D.

50 utils.

Angela has 7 yellow shirts in her closet already and is given the choice between purchasing another yellow shirt and a blue shirt. Angela purchases another yellow shirt. What can we conclude about her utility?

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Part 1

A.

Her marginal utility for blue shirts is negative.

B.

Her marginal utility for the blue shirt is greater than the 8th yellow shirt.

C.

Angela is not rational.

D.

Her marginal utility for the 8th yellow shirt is greater than the first blue shirt.

As output of a good increases from 1 an hour to 10, we would expect average fixed costs to

Question content area bottom

Part 1

A.

Remain constant.

B.

Remain inelastic.

C.

Increase.

D.

Decrease.