Author Question: Suppose early Friday morning the economics club buys 200 donuts at 25 cents each, and plans to sell ... (Read 53 times)

lak

  • Hero Member
  • *****
  • Posts: 546
Suppose early Friday morning the economics club buys 200 donuts at 25 cents each, and plans to sell all of them later in the day on campus for 50 cents each.
 
  Only 60 donuts are sold at 50 cents, however, and by early afternoon the club is seen trying to unload the remaining donuts for 10 cents each. What can we conclude? A) The club was clearly engaging in predatory pricing of donuts.
  B) The club was clearly selling below cost.
  C) The club clearly misjudged the demand for donuts.
  D) All of the above are true.

Question 2

Under fair-returns price regulation:
 
  A) deadweight loss is likely to be maximized.
  B) deadweight loss is likely to be minimized.
  C) firms are less likely to innovate because they earn zero profits.
  D) firms are more likely to innovate because they earn positive profits.



matt95

  • Sr. Member
  • ****
  • Posts: 317
Answer to Question 1

C

Answer to Question 2

C



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

ACTH levels are normally highest in the early morning (between 6 and 8 A.M.) and lowest in the evening (between 6 and 11 P.M.). Therefore, a doctor who suspects abnormal levels looks for low ACTH in the morning and high ACTH in the evening.

Did you know?

The U.S. Pharmacopeia Medication Errors Reporting Program states that approximately 50% of all medication errors involve insulin.

Did you know?

Disorders that may affect pharmacodynamics include genetic mutations, malnutrition, thyrotoxicosis, myasthenia gravis, Parkinson's disease, and certain forms of insulin-resistant diabetes mellitus.

Did you know?

In the United States, there is a birth every 8 seconds, according to the U.S. Census Bureau's Population Clock.

Did you know?

It is widely believed that giving a daily oral dose of aspirin to heart attack patients improves their chances of survival because the aspirin blocks the formation of new blood clots.

For a complete list of videos, visit our video library