The production function in Scenario 7.3 exhibits: A) ...

[iveyjurea]

The production function in Scenario 7.3 exhibits:
 
  A) decreasing returns to scale.
  B) constant returns to scale.
  C) increasing returns to scale.
  D) all of the above at various levels of output.

Question 2

Some high-end retail stores that distribute mail-order catalogs will prominently offer some very high priced goods for sale (for example, a luxury sports car with gold-plated interior trim) in addition to their regular line of merchandise.
 
  Behavioral economists argue that the stores do not really plan to sell these goods, but they use these items to provide the customers with a high reference point for the prices of the other goods in the catalog. This practice is an example of: A) the ultimatim game.
  B) loss aversion.
  C) anchoring.
  D) none of the above

[ebenov]

Answer to Question 1

B

Answer to Question 2

C

[iveyjurea]

Thanks for the timely response, appreciate it

[bigcheese9]

Excellent