ECON 102 Final

ultimatum game

A game in which a proposer is given a sum of money and makes an offer to a responder as to how this money should be split between them. The responder must choose to accept the offer or reject it. This game has been used to study people's decision-making strategies.

utils

A hypothetical unit of measurement often used to quantify utility; aka "happy points"

E

According to behavioral​ economics, consumers A. do not always behave rationally because they ignore sunk costs. B. do not always behave rationally because they accurately project their future behavior. C. always behave rationally because they take into account monetary costs and nonmonetary opportunity costs. D. do not always behave rationally because they take into account nonmonetary opportunity costs. E. do not always behave rationally because they are overly optimistic about their future behavior.

C

According to behavioral​ economists, why might consumers or businesses not act​ rationally? People might not act rationally because they A. experience no endowment effect. B. account for monetary costs. C. fail to ignore sunk costs. D. fail to ignore nonmonetary opportunity costs. E. are too realistic about their future behavior.

E

Consumer choices are affected by social influences such as A. fairness. B. whether consumption of a product will make the consumer appear knowledgeable. C. product popularity. D. celebrity endorsements. E. all of the above.

C

An example of explicit collusion is A. price​ leadership, and an example of implicit collusion is firms forming a cartel. B. price​ leadership, and an example of implicit collusion is firms advertising that they will match the lowest price offered by any competitor. C. where firms meet and agree to not compete​, and an example of implicit collusion is price leadership. D. firms advertising that they will match the lowest price offered by any​ competitor, and an example of implicit collusion is price leadership. E. where firms meet and agree to not compete​, and an example of implicit collusion is firms forming a cartel.

$29.50

An example of odd pricing might be to charge ​______ instead of ​$30.00.

D

Arbitrage is A. paying different wages to different workers based on irrelevant characteristics such as race. B. the practice of firms gathering information on​ consumers' preferences and the responsiveness of consumers to changes in prices to rapidly adjust prices. C. buying a product at a lower price than the equilibrium price. D. buying a product in one market at a low price and reselling it in another market at a higher price. E. charging higher prices to some customers and lower prices to other customers.

B

Arbitrage would be prevented from ensuring that identical products sell for the same price everywhere if A. products can be resold. B. transaction costs are high. C. firms practice yield management. D. ​two-part tariffs are high. E. both a and b.

C

Are consumers only interested in making themselves as well off as possible in a material​ sense? Consumers are A. only concerned with their own utility as exemplified by only tipping in restaurants that will be visited again. B. only concerned with their own financial​ well-being as exemplified by only parting with money when required. C. also concerned with fairness as exemplified by tipping in restaurants that will never be visited again. D. only concerned with their own utility as exemplified by social influences having no effect on​ decision-making. E. also concerned with fairness as exemplified by network externalities.

Fewer, more

Assume the price of CDs is ​$16 and the price of DVDs is ​$22. At those​ prices, Isabel consumes 14 CDs and 13 DVDs. Her marginal utility from the last CD consumed is 134 and her marginal utility from the last DVD consumed is 263. Without changing the combined amount spent on CDs and​ DVDs, Isabel can increase her utility by consuming ______ CDs and ______ DVDs.

D

Behavioral economists LOADING... attribute some consumer behavior to the endowment effect. Which of the following is an example of the endowment​ effect? An example of the endowment effect is A. taking into account nonmonetary opportunity costs such as the value of your time. B. buying lottery tickets with an expected value that is less than their price. C. being willing to will your descendents a house upon your death that you otherwise could have sold for a substantial price. D. being unwilling to sell a painting for a price that is greater than the price you would be willing to pay to buy the painting if you​ didn't already own it. E. being unwilling to sell a car that you already own.

B

Bob consumes food and housing. Suppose his marginal utility from an additional unit of food is 10 and his marginal utility from an additional unit of housing is 100. ​ Furthermore, suppose the price of a unit of food is ​$1.00 and the price of a unit of housing is ​$4.00. Can Bob increase his utility without changing his total expenditures on food and​ housing? Holding expenditures​ constant, A. Bob cannot increase his utility. B. Bob can increase utility by spending less on food and more on housing. C. Bob can increase utility by spending more on food and the same amount on housing. D. Bob can increase utility by spending more on food and less on housing. E. Bob can increase utility by spending more on food and more on housing.

inelastic, higher

Business travelers have a more _____ demand than leisure​ travelers, so airlines charge business travelers ______ price.

E

Consider a form of public consumption LOADING... such as wearing clothes. An​ individual's demand for clothes depends on A. the​ individual's tastes and preferences. B. the cost of the clothes. C. the popularity of the clothes. D. both a and b. E. all of the above.

negative, negative

Consider the demand for Ramen noodles. Suppose the price of Ramen noodles increases. If Ramen noodles are a normal ​good, this will produce a __________ substitution effect and a _______ income effect.

$0.01, accepts, is

Consider the ultimatum game LOADING...​, where an​ "allocator" is​ given, say, ​$50.00 to decide how to divide with a​ "recipient," who then decides whether to accept or reject the​ allocation, ultimately determining whether the pair receives the allocation or nothing. What is the optimal play in the ultimatum​ game? The optimal play in the ultimatum game is for the allocator to propose a division of the money such that the recipient receives ​$_____ and the recipient then _______ the division. ​(Enter your response as a real number rounded to two decimal​ places.) When the ultimatum game experiment is carried​ out, both allocators and recipients act as if fairness ______ important.

ignore nonmonetary opportunity costs, fail to ignore sunk costs, overly optimistic about future

Consumers commonly commit the following three mistakes when making decisions

A

Do airlines practice price discrimination LOADING...​? Explain. Airlines A. engage in price discrimination by charging business travelers and leisure travelers different prices. B. do not engage in price discrimination because the marginal cost of flying one additional passenger is low. C. do not engage in price discrimination because they charge lower prices to passengers who will stay at their destination over a Saturday night. D. do not engage in price discrimination because their passengers have similar demands. E. engage in price discrimination by maintaining the same price on seats even if seats will not be sold.

B

Firms use various pricing strategies to increase profits. Which of the following is an example of one of these pricing​ strategies? Some firms use A. yield​ management, where where firms add a percentage markup to average cost. B. cost minus plus pricing comma where firms add a percentage markup to average cost. C. odd pricing comma where a firm might charge $ 5.00 instead of $ 4.00 or $ 100 instead of $ 200. D. a two minus part tariff comma where goods sell for a different comma higher price in other countries. E. ​arbitrage, where consumers pay one price to buy as much of a good as they want at a second price.

sequential game

Game in which players move in turn, responding to each other's actions and reactions

D

Give an example of a firm using a​ two-part tariff as part of its pricing strategy. An example of a​ two-part tariff is A. a tennis club requiring the purchase of an annual membership in addition to a fee each time members use the tennis courts. B. Sam's club requiring consumers to pay a membership fee before shopping at its stores. C. a college changing the cost of tuition with financial aid according to application for early admission. D. both a and b. E. all of the above.

B

How are decision trees used to analyze sequential​ games? A decision tree A. contains strategy nodes where firms must make​ decisions, arrows illustrating the​ decisions, and terminal nodes showing the resulting rates of return. B. contains decision nodes where firms must make​ decisions, arrows illustrating the​ decisions, and terminal nodes showing the resulting rates of return. C. is a model identifying five forces that determine the level of competition in an industry. D. is a table that shows the payoff each firm earns from every combination of strategies by the firms. E. is a situation in which each firm chooses the best​ strategy, given the strategies chosen by other​ firms, and where no firm can make itself better off by changing its decision at any node.

B

How is the​ prisoner's dilemma result changed in a repeated​ game? In a repeated​ game, A. players can essentially form a cartel. B. players can employ retaliation strategies. C. players can appoint a​ first-mover. D. players can implicitly collude. E. players are unable to employ enforcement mechanisms.

D

How should sunk costs LOADING... be used in consumer​ decision-making? In consumer​ decision-making, sunk costs should A. be treated as nonmonetary costs. B. be treated as opportunity costs. C. be treated as monetary costs. D. be ignored. E. be included in the budget constraint.

C

In game​ theory, A. players determine their objectives and then payoffs are randomly assigned. B. agents determine their​ objectives, and principals are hired by contract to achieve those objectives. C. rules determine what actions are​ allowable, players employ strategies to attain their​ objectives, and payoffs are the results of the interaction among the​ players' strategies. D. a natural experiment is used to determine the effect of a factor by treating a portion of​ participants, with remaining untreated participants becoming the control group. E. players employ strategies to attain their objectives sequentially so that they are not affected by the actions of other players.

D

In the presence of​ shortages, why would a​ firm, such as a restaurant with people waiting for a table or a theater with people waiting for a​ ticket, not raise prices when doing so would seem to increase​ profits? A. Increasing prices might eliminate the shortage as well as the product's perceived popularity. B. Increasing prices might alienate customers. C. Increasing prices requires the firm to pay substantial​ "switching costs." D. Both a and b. E. All of the above.

D

In this​ instance, the ​$74 cost of the football game ticket is a A. nonmonetary opportunity cost. B. switching cost. C. endowment cost. D. sunk cost. E. hidden​ add-on cost.

more, less

Instead, suppose ham is an inferior good. If the price of ham​ increases, then consumers will demand ________ ham due to the income effect and _____ ham due to the substitution effect.

D

In​ economics, A. the rules of the game include a firm's production function​, a strategy is a firm's actions to achieve a goal​, and the payoffs are output levels. B. the rules of the game include​ technology, a strategy is the​ firm, and the payoffs are profits. C. the rules of the game include​ technology, a strategy is the​ government, and the payoffs are the cost of production. D. the rules of the game include laws that a firm must obey​, a strategy is a firm maximizing profits​, and the payoffs are profits. E. the rules of the game include laws that a firm must obey​, a strategy is a firm's actions to achieve a goal​, and the payoffs are the cost of production.

A

Is perfect price discrimination economically​ efficient? Perfect price discrimination is A. efficient because it converts into producer surplus what had been consumer surplus and deadweight loss. B. inefficient because it restricts output below the equilibrium level and creates deadweight loss. C. inefficient because it results in no consumer surplus. D. inefficient because it converts into producer surplus a portion of deadweight loss. E. efficient because it converts into producer and consumer surplus what had been deadweight loss.

perfect price discrimination

Occurs when a firm charges the maximum amount that buyers are willing to pay for each unit.

B

Perfect price discrimination is A. unlikely to occur because firms are typically able to keep consumers who buy a product at a low price from reselling it. B. unlikely to occur because firms typically do not know how much each consumer is willing to pay. C. likely to occur because it results in economic efficiency. D. likely to occur because it results in higher profits. E. both a and b.

E

Suppose a consumer is trying to decide how much to spend on housing and how much to spend on all other ​(non-housing​) consumption. The economic model of consumer behavior predicts that the consumer will A. consume any combination of housing and ​non-housing consumption from among the combinations of housing and ​non-housing items she can afford. B. consume an infinite amount of housing and ​non-housing consumption. C. consume as much housing and as much ​non-housing consumption as she wants. D. consume as much housing as she can afford without any ​non-housing consumption. E. choose the combination of housing and ​non-housing consumption that makes her as well off as possible from among the combinations of housing and ​non-housing items she can afford.

E

Suppose a local tennis club uses a​ cost-plus approach to charge members to play tennis. In​ particular, the club estimates that it will cost ​$227 comma 000 to provide 20 comma 000 sets of tennis. If the club marks up the average cost of producing a set of tennis 30​ percent, then it will charge a price of ​$ 14.76 per set of tennis. ​(Enter your response rounded to two decimal​ places). Evaluate whether​ cost-plus pricing maximizes profits. A. ​Cost-plus pricing comes close to maximizing profits when marginal cost is difficult to calculate. B. ​Cost-plus pricing fails to maximize profits because it focuses only on average total cost and ignores marginal cost. C. ​Cost-plus pricing comes close to maximizing profits when marginal cost and average cost are roughly equal. D. ​Cost-plus pricing does not maximize profits because it does not necessarily result in a quantity where marginal revenue equals marginal cost. E. All of the above.

A

Suppose ham is a normal LOADING... good. How will consumers adjust their buying decisions if the price of ham​ changes? If the price of ham​ increases, then consumers will demand A. less ham due to the income effect because their purchasing power decreases and less ham due to the substitution effect because the opportunity cost of consuming ham is higher. B. more ham due to the income effect because their purchasing power decreases and less ham due to the substitution effect because the opportunity cost of consuming ham is higher. C. more ham due to the income effect because their purchasing power increases and less ham due to the substitution effect because the opportunity cost of consuming ham is higher. D. more ham due to the income effect because the opportunity cost of consuming ham is lower and less ham due to the substitution effect because their purchasing power decreases. E. less ham due to the income effect because the opportunity cost of consuming ham is higher and less ham due to the substitution effect because their purchasing power decreases.

25000

Suppose it is October 1. You have paid ​$16 comma 000 in tuition and have been attending college classes. ​ However, you are offered a​ full-time job paying ​$25 comma 000 for the next two months. If you take the​ job, you'll have to stop attending classes and withdraw from college for the semester. ​ Unfortunately, at this point in the​ semester, tuition is no longer refundable. You must decide whether to remain enrolled in college. What is the relevant cost of staying in​ school? When deciding whether to remain in​ school, the relevant cost of staying in school is ​$

E

Suppose two products that seem to be identical sell for different prices. Suppose also that transaction costs are zero and that the products can be resold. Why might the law of one price LOADING... not​ hold? The law of one price may not hold even when transaction costs are zero because A. the opportunity costs of the companies selling the products may differ. B. the government is not enforcing antitrust policies making price discrimination illegal. C. costs associated with company reputation are zero. D. the companies are operating in the short​ run, and the law of one price applies only to the long run. E. the company of one product may be more reliable than its competitors.

Baseball game

Suppose you bought a ticket to a basketball game. The ticket is nonrefundable​ (and can't be​ resold) and must be used on Saturday.​ Then, a friend calls and invites you to a baseball game on Saturday. You only have time to attend one of the​ events, and your friend offers to pay the cost of going to the baseball game. If you prefer baseball games over basketball games​, then you should attend the ____________

B

Suppose you have a monthly entertainment budget that you use to rent movies and purchase CDs. You currently use your income to rent 5 movies per month at a cost of​ $5.00 per movie and to purchase 5 CDs per month at a cost of​ $10.00 per CD. Your marginal utility LOADING... from the fifth movie is 50 and your marginal utility from the fifth CD is 90. Are you maximizing​ utility? You are A. maximizing utility because you are spending all of your entertainment budget. B. not maximizing utility because the marginal utility per dollar spent on movies is not equal to the marginal utility per dollar spent on CDs. C. maximizing utility because you are consuming an equal number of movies and CDs. D. not maximizing utility because the price of movies is not equal to the price of CDs. E. not maximizing utility because the marginal utility of movies is not equal to the marginal utility of CDs.

Play golf with your friend

Suppose you have purchased a ticket to an NFL football game for ​$74. The ticket is​ nonrefundable, cannot be​ resold, and must be used on Sunday​ afternoon, which is the only time the game will be played. Prior to the​ game, a friend calls and invites you to his country club to play a round of golf on Sunday afternoon. Though the cost of a round of golf is ​$34​, your friend will pay the cost of golfing at the club. Assume you would rather play a round of golf with your friend than attend the NFL football game. What would you do if behaving​ rationally?

equi-marginal principle

The marginal utility per dollar spent on good X must equal the marginal utility per dollar spent on good Y

loss aversion

The strong tendency to regard losses as considerably more important than gains of comparable magnitude—and, with this, a tendency to take steps (including risky steps) to avoid possible loss.

utility

The value, or satisfaction, that people derive from the goods and services they consume and the activities they pursue.

A

Under what circumstances can a firm successfully practice price​ discrimination? To successfully practice price​ discrimination, A. some consumers must have greater willingness to pay for the product than others and a firm must know consumer willingness to pay for the product. B. arbitrage must be possible. C. a firm must not have market power. D. both a and b. E. all of the above.

E

What affects the desirability of a​ product? Products become more desirable when A. celebrities use a product because consumers who use the same product may feel closer to famous people. B. movie stars use a product because consumers who use the same product may feel more fashionable. C. professional athletes use a product because consumers perceive them to be particularly knowledgeable about it. D. both a and b. E. all of the above.

E

What explanation might an economist provide why some people overeat when such behavior can lead to health​ consequences? Some people likely overeat because A. they overestimate the future costs of current choices. B. they undervalue the utility from current choices. C. they accurately estimate the utility from current choices. D. they overvalue the utility to be received in the future from being thin. E. their preferences are not consistent over time.

B

What is a sequential​ game? A sequential game is a game A. with dominant strategies. B. where one firm acts first and then the other firms respond. C. where all firms act simultaneously. D. without a​ subgame-perfect equilibrium. E. without bargaining between firms.

D

What is perfect price​ discrimination? A. Charging consumers who are less price sensitive a higher price and consumers who are more price sensitive a lower price. B. Charging consumers whose demand is less elastic a lower price and consumers whose demand is more elastic a higher price. C. Charging consumers different prices across time. D. Charging every consumer a different price equal to their willingness to pay. E. Charging consumers a price equal to consumer surplus.

E

What is price​ discrimination? Price discrimination is when A. firms charge a higher price to customers whose demand is less elastic and a lower price to consumers whose demand is more elastic. B. firms charge a higher price for a product when it is first introduced and a lower price later. C. firms charge each consumer a different price equal to that​ consumer's willingness to pay. D. both a and b. E. all of the above.

A

What is required for a firm to successfully engage in price​ discrimination? Successful price discrimination requires A. the firm to have market power. B. the firm to be able to engage in arbitrage. C. the firm to be unable to divide up the market between customers. D. the customers to have the same willingness to pay for the product. E. the prices customers are willing to pay to be unknown.

D

What is required for the law of one price to​ hold? The law of one price will hold exactly if A. arbitrage is illegal. B. the government enforces antitrust laws prohibiting price fixing. C. barriers do not prevent new firms from entering an industry in which firms are earning economic profits. D. transaction costs associated with arbitrage are zero. E. firm managers are able to practice yield management with accurate information on customer preferences.

D

What is the difference between explicit collusion and implicit​ collusion? Unlike explicit​ collusion, implicit collusion A. is where firms meet and agree to not compete without employing retaliation strategies. B. is where firms meet and agree to not compete without appointing a price leader. C. is illegal. D. is where firms signal to each other without actually meeting and agreeing to not compete. E. is where firms meet to discuss charging the same price without actually reaching an agreement.

D

What is the law of one​ price? A. Identical products should sell for the same price​ everywhere, regardless of transactions costs. B. Different products should sell for the same price​ everywhere, assuming no transactions costs. C. Identical products should sell for the same price in a particular​ location, assuming no transactions costs. D. Identical products should sell for the same price​ everywhere, assuming no transactions costs. E. A product should sell for one price with no additional transactions costs.

A

What is​ cost-plus pricing? An example of​ cost-plus pricing is charging a price A. 10 percent higher than average cost. B. ending in a​ "5" or a​ "0." C. that increases profits by 25 percent. D. 30 percent higher than fixed costs. E. that changes rapidly with demand.

B

What role does utility LOADING... play in the economic model of consumer​ behavior? When modeling consumer​ behavior, utility A. identifies the combination of goods and services that can be produced most efficiently. B. reflects the satisfaction a consumer receives from consuming a particular set of goods and services. C. provides an objective measure of enjoyment from consuming a particular set of goods and services in units called​ "utils." D. identifies the consumer who receives the most satisfaction from consuming a particular set of goods and services. E. identifies the combination of goods and services that is least expensive.

B

When does the law of one price not​ hold? The law of one price will not hold when A. products can be resold. B. transactions costs are high. C. firms do not have reputations. D. firms cannot practice price discrimination. E. firms offer different levels of service.

86th floor of Empire State Building

Where did the first 3 teams meet in the video where 6 teams were randomly dropped in NYC

D

Which of the following is an example of price​ discrimination? An example of price discrimination is A. a movie theater charging higher prices for evening showings than for afternoon showings. B. an airline charging higher prices for business travelers than for leisure travelers. C. an apartment complex charging higher rent to African minus Americans than to whites. D. Both a and b. E. All of the above.

A

Why have some firms traditionally used odd​ pricing? Firms have traditionally used odd pricing because A. charging a nickel less than a round number somehow seems like a significant reduction. B. charging an odd price guarantees a price that is greater than marginal cost. C. consumers are willing to pay more when prices seem randomly determined. D. charging an odd price allows firms to charge higher prices to customers that are more price sensitive. E. charging an odd price indicates that the good is produced domestically.

E

Why might consumers not act​ rationally? Consumers might A. ignore sunk costs. B. take into account nonmonetary opportunity costs. C. only take actions that are appropriate to reach their goals. D. ​don't take into account monetary costs. E. be overly optimistic about their future behavior.

sunk cost

a cost that has already been committed and cannot be recovered

risk aversion

a dislike of uncertainty

Prisoner's Dilemma

a game in which pursuing dominant strategies results in noncooperation that leaves everyone worse off

game tree

a graphical representation of the consequences of different actions in a strategic setting

bounded rationality

a process of making decisions by constructing simplified models that extract the essential features from problems without capturing all their complexity

tit-for-tat strategy

a repeated game strategy in which a player responds in kind to an opponent's play

two-part tariff

a situation in which consumers pay one price (or tariff) for the right to buy as much of a related good as they want at a second price

Nash Equilibrium

a situation in which each firm chooses the best strategy, given the strategies chosen by other firms

dominant strategy

a strategy that is best for a player in a game regardless of the strategies chosen by the other players

ignored

a sunk cost should be ________ in decisions about future actions

credible threat

a threat to take an action that is in the threatener's interest to carry out

terrible at realizing what other people value gifts

according to the adam ruins everything video, what is the problem with gift giving

marginal analysis

analysis that involves comparing marginal benefits and marginal costs

principal of diminishing marginal utility

as you consume more of a good, after some point, the marginal utility received from each additional unit of a good decreases with each additional unit consumed, other things equal

Irrational decision making

assume that decision making is nearly always uncertain and risky, making it difficult for managers to make optimal decisions

optimal consumption bundle

bundle that maximizes total utility given a budget constraint

price discrimination

buying a printer then having to but ink separately is an example of

mental accounting

categorizing spending and saving decisions into "accounts" mentally designated for specific consumption transactions, goals, or situations

C

charge different​ prices? Firms might charge different prices for the same product even when transactions costs are zero and the product can be resold if the A. firms practice arbitrage. B. firms practice price discrimination. C. firms offer different levels of service. D. reputations of the firms are identical. E. firms are in different locations.

single-price monopolist

charges all consumers the same price

zero consumer surplus

entire surplus is captured by the monopolist in the form of profit

printer and ink

example of advanced purchase discounts

sitting through movie you hate at movie theater because you payed for it

example of misperceptions of opportunity costs

throwing money into stock market when you don't know how it works

example of overconfidence

senior citizen discount

example of price discrimination

get same food at restaurant

example of status quo bias

buffet

examples of a marginal decision

new years resolution, getting perfect score on final exam when you've failed all of the midterms

examples of unrealistic expectations about future behavior

can win if they go first

for first mover, what is the difference between first mover and second mover

wherever > is pointing, buy more of that

for optimal consumption bundle, how do you compare the 2 MU/$

can win if they look at results of first mover

for second mover, what is the difference between first mover and second mover

deadweight loss

in perfect price discrimination, there is no ______________ because all mutually beneficial transactions are exploited

take 1 flag because it was in intervals of 4

in the survivor video, what is the 1st movers advantage

Income effect for a inferior good

increase in price causes consumers' purchasing power to drop and increases consumption

Income effect for a normal good

increase in price causes consumers' purchasing power to drop and reduces consumption

razor blades and razors, xbox and video games

more examples of two-part tariffs

bang for the buck

more intuitive name for equi-marginal principle

arbitrage

practice of buying at a low price at one location and selling at a higher price in another

people have desire for revenge, even when we're hurting ourselves

quote from tv show numbers

one

single-price monopolist charges __________ price to all customers

status quo bias

tendency to do nothing when faced with making a decision

marginal utility per dollar

the additional utility from spending one more dollar on that good or service

price discrimination

the business practice of selling the same good at different prices to different customers

income effect

the change in the quantity demanded of a good that results from the effect of a change in the good's price on consumers' purchasing power

consumption bundle

the collection of all the goods and services consumed by that individual

diminishing marginal utility benefit

the extra benefit of adding one unit

law of one price

the notion that a good should sell for the same price in all markets

game theory

the study of how people behave in strategic situations

behavioral economics

the study of situations in which people make choices that do not appear to be economically rational

all consumer surplus as profit

under perfect price discrimination, the firm captures

benefit

value that comes from dollars

income, time

we don't live in a world of all you can eat buffets because people have constraints on

concerns about fairness

we want to make sure people are treated fairly

pizza and beer

what 2 things does Wooten love

skiing, reading book for second timw

what are some examples to principal of diminishing marginal utility

must have market power, can't resell product, easily identifiable groups

what are the three requirements for price discrimination

signs

what did the teams in the video where 6 teams were randomly dropped in NYC use to attract the other people

overspending on payday or sales

what is an example of counting dollars unequally

extra pencils in exam if one breaks

what is an example of risk aversion

there is no saving

what is the 2nd assumption dealing with utility and customers

marginal utility/benefit diminishes over time

what is the 3rd assumption dealing with utility and customers

mu/$ = mu/$

what is the MU per dollar calculation

loss aversion

what is the fifth reason we make irrational decisions

all goods have value

what is the first assumption dealing with utility and customers

misperceptions of opportunity costs

what is the first reason we make irrational decisions

counting dollars unequally

what is the fourth reason we make irrational decisions

overconfidence

what is the second reason we make irrational decisions

status quo bias

what is the sixth reason we make irrational decisions

unrealistic expectations about future behavior

what is the third reason we make irrational decisions

selling bible to widows and increasing price depending on how rich

what was the premise of the paper moon movie clip in class with the daughter and the little girl

advanced purchase discounts

what you're buying has 2 parts to it

substitution effect

when consumers react to an increase in a good's price by consuming less of that good and more of other goods

noon

when did the teams in the video where 6 teams were randomly dropped in NYC go to their designated spots

noncooperative behavior

when firms ignore the effects of their actions on each others' profits

close to competition

where do you put your business in relation to other businesses