1. People\'s willingness to buy the PC or Mac format of computer software depend
ID: 1165013 • Letter: 1
Question
1. People's willingness to buy the PC or Mac format of computer software depends on how popular the software format is among other consumers. This is an example of:
A) the prisoners' dilemma. B) a network effect. C) an opportunity cost. D) a cartel.
2.Oligopoly is a situation when there:
A) is one firm in the industry that is fairly large. B) are a few large firms in the industry. C) is one giant firm and many smaller firms forming a competitive fringe. D) are too many firms in the industry and there is excess capacity.
3. In an oligopolistic market, each firm:
A) has a constant marginal cost. B) produces at minimum average cost in the long run. C) faces a perfectly elastic demand function. D) must consider the reaction of rival firms when making a pricing or output decision.
4. The idea that if enough consumers cut back on their use of a product it induces other consumers to do the same is referred to as:
A) elicit market feedback. B) negative market feedback. C) non-dynamic market feedback. D) positive market feedback.
Explanation / Answer
Answer : 1) The correct option is B.
Because in case of "network effect", people want to buy those products which are popular to other people. This means in case of network effect if a people want to buy a product then this people firstly see that the product is how much popular to others. As the given statement indicates the exact situation of "network effect", the given statement is the example of "network effect".
2) The correct option is B.
Because the main characteristic of oligopoly market is that in the industry only a few firms exist who has large shares.
3) The correct option is D.
One of the most important characteristics for oligopoly market is interdependence between firms in the industry when firms decide the price level and output level. This means in oligopoly market firms consider the rival firm's reactions for price decision and output decision.
4) The correct option is B.
"Negative market feedback" means that in the market there is a negative impact of taking a decision by others. According to the given statement , consumers decreases their use for a product and this leads to decrease the use of that product for other consumers. Here, some consumer's decreasing usation for a product impacts negatively to other consumers in the market. Therefore, the given statement is the example of "negative market feedback".
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.