Is there any truth in the saying that the price of a good is a reflection of its quality?
Answer to relevant QuestionsAssume that oil begins to run out and that extraction becomes more expensive. Trace through the effects of this on the market for oil and the market for other fuels.If the government increases the tax on a liter of petrol by 5p, what will determine the amount by which the price of petrol will go up as a result of this tax increase?Consider situations where you might consider swapping items with someone. Why are such situations relatively rare? Can you think of circumstances in which this might be more common?Why might it make sense for a firm which cannot sell its output at a profit to continue in production for the time being? For how long should the firm continue to produce at a loss?Why, under oligopoly, might a particular industry be collusive at one time and yet highly price competitive at another?
Post your question