This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Which of the following is true concerning the income effect of a decrease in price? A) It will ... (Read 11 times)

genevieve1028

  • Hero Member
  • *****
  • Posts: 601
on: Jul 1, 2018
Which of the following is true concerning the income effect of a decrease in price?
 
  A) It will lead to an increase in consumption only for a normal good.
  B) It always will lead to an increase in consumption.
  C) It will lead to an increase in consumption only for an inferior good.
  D) It will lead to an increase in consumption only for a Giffen good.

Question 2

Trisha's Fashion Boutique sells earrings and pendants. Trisha has two types of customers. Their willingness-to-pay for earrings and pendants are given in the table below.
 
  If Trisha bundles the earrings and pendants together, could she increase revenue? Earrings Pendant Type I 100 65 Type II 90 75


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

iceage

  • Guest
Reply #1 on: Jul 1, 2018
Answer to Question 1

A

Answer to Question 2

If Trisha bundles the products together and sells the bundle for 165, each of her customers will be willing to buy the bundle. Without bundling, Trisha would need to sell the earrings for 90 and the pendants for 65 in order to sell each customer both items. Thus, revenue from both items is 155 for each customer. Bundling increases Trisha's revenues by 10 per customer.


genevieve1028

  • Member
  • Posts: 601
Reply 2 on: Jul 1, 2018
Thanks for the timely response, appreciate it

adf223

  • Member
  • Posts: 304
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

The first-known contraceptive was crocodile dung, used in Egypt in 2000 BC. Condoms were also reportedly used, made of animal bladders or intestines.

Did you know?

The people with the highest levels of LDL are Mexican American males and non-Hispanic black females.

Did you know?

People who have myopia, or nearsightedness, are not able to see objects at a distance but only up close. It occurs when the cornea is either curved too steeply, the eye is too long, or both. This condition is progressive and worsens with time. More than 100 million people in the United States are nearsighted, but only 20% of those are born with the condition. Diet, eye exercise, drug therapy, and corrective lenses can all help manage nearsightedness.

Did you know?

When intravenous medications are involved in adverse drug events, their harmful effects may occur more rapidly, and be more severe than errors with oral medications. This is due to the direct administration into the bloodstream.

Did you know?

There are major differences in the metabolism of morphine and the illegal drug heroin. Morphine mostly produces its CNS effects through m-receptors, and at k- and d-receptors. Heroin has a slight affinity for opiate receptors. Most of its actions are due to metabolism to active metabolites (6-acetylmorphine, morphine, and morphine-6-glucuronide).

Inverse Relation Between IQ and Disease. Could this explain the Flynn effect? Inverse Relation Between IQ and Disease. Could this explain the Flynn effect?
Medications That May Cause Myopathy as an Adverse Effect Medications That May Cause Myopathy as an Adverse Effect
Effect of an Exogenous Shift in Income Effect of an Exogenous Shift in Income
Income per Capita versus Total Fertility Rate Income per Capita versus Total Fertility Rate
Effect of Productivity Improvement in the Malthusian Model Effect of Productivity Improvement in the Malthusian Model
Effect of dietary fats on high- and low-density cholesterol levels Effect of dietary fats on high- and low-density cholesterol levels
Video: The pH scale - Strong acids and Weak acids

For a complete list of videos, visit our video library