A there is nothing you can do to stop the recliner b

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A. There is nothing you can do to stop the "recliner."
B. As long as the "recliner" values reclining less than you value your leg space, you won't be able to change to outcome. C. If you value your leg space more than the "recliner" values reclining, than you can pay them to stop reclining. D. You will receive payment from the "recliner" in order for them to be able to recline. Answer Key: C Feedback: Since property rights were well-established, you ever values the good more will receive it. Thus if you value your leg space more than they value reclining, you can pay them. Question 10 of 10 1.0 Points A "Veblen good" is one for which A. quantity demanded goes down as income goes up. B. quantity demanded goes up as income goes up. C. quantity demanded goes down as price goes up. D. quantity demanded goes up as price goes up. Answer Key: D Feedback: "Veblen good"s seem to break the law of demand, but once luxury preferences are accounted for, they are fine.
Quiz 8 Part 1 of 1 - Multiple Choice 10.0 Points Question 1 of 10 1.0 Points If you are an auctioneer in a common value action you should do all of the following EXCEPT A. Encourage everyone to bid aggressively B. Reduce the uncertainty of the value of the item C. Hide adverse information that would devalue the item D. Release as much information about the item as possible Answer Key: C Feedback: You definitely want agressive bidding, but you also want them having a good idea of what it's worth, even if that means releasing bad info. Thus, do not hide adverse info. Question 2 of 10 1.0 Points The demand for insurance arises from people who are: A. Risk-seeking B. Risk-neutral C. Risk-averse D. None of the above Answer Key: C Feedback: Risk-averse people want to insure against potential losses. Question 3 of 10 1.0 Points The manager of an ice-cream parlor decides to introduce a new ice-cream flavor in his Dallas, TX based restaurants to compare the sales of these restaurants to the ones with no new flavors. She decides to run a difference in difference approach. Which of the following is true?
A. The first difference would be the difference in the sales of the Dallas stores before and after the introduction B. The second difference would be the difference in the sales in other stores before and after the Dallas stores introduced the new flavor C. Both A and B D. Neither A nor B Answer Key: D Feedback: The first diff is actually the difference in both stores before and after, netting two numbers. The second diff is then the diff between these two numbers. Question 4 of 10 1.0 Points Suppose that you have 2 buyers. The first buyer values your product at $10, and the second buyer values your product at $6. You estimate that the probability of getting a high valued customer is 40%. Your marginal costs are $3. What is your optimal price and expected profit?

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