20) Hot dogs and hot dog buns are compliments for consumers. If the price of a h
ID: 2443054 • Letter: 2
Question
20) Hot dogs and hot dog buns are compliments for consumers. If the price of a hot dog rises, then the equilibrium price of hot dog buns ____ and the equilibrium quantity ____. A) does not change; does not change B) rises; decreases C) might fall, rise, or not change; increases D) falls; increases E) falls; decreases
21) Target
Set low prices Set high prices Set low prices T: $19 million W: $1 million T: $14 million W: $13 million
Walmart Set high prices T: $8 million W: $7 million T: $6 million W: $8 million
Target and Wal-Mart must decide whether to lower their prices, based on the potential economic profits shown in the table above. (A “T” indicates Target’s profit and a “W” indicates Wal-mart’s profit.) Who has a dominant strategy? A) Walmart has a dominant strategy but Target does not. B) Target has a dominant strategy but Walmart does not. C) Both Walmart and Target have dominant strategies. D) Neither Walmart nor Target has a dominant strategy
22) A common resource is ____ and ____ and a competitive market with no government intervention uses ____ allocatively efficient quantity. A) rival; nonexcludable; less than the B) nonrival; excludable; more than the C) nonrival; nonexcludable; less than the D) rival; nonexcludable; more than the E) rival; excludable; the
Explanation / Answer
20) Option C-
Hot dogs and hot dog buns are compliments for consumers. If the price of a hot dog rises, then the equilibrium price of hot dog buns might fall, rise, or not change and the equilibrium quantity increases.
21) Option B- Target has a dominant strategy but Walmart does not
22) Option B- A common resource is nonrival and excludable and a competitive market with no government intervention uses more than the allocatively efficient quantity
Please note the answer is given as per my knowledge
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