Test Questions without Answers
Chapter 21. Price and Value Theory.
Functions and Behaviour of Prices
Chapter 21–Question 1
The price of apples falls. This means for the price of oranges
- it must be lowered
- their relative price has risen
- their relative price has fallen
- their absolute price rises
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Chapter 21–Question 2
Co-ordination failure stands for
A. a lack of government regulation
B. a lack of competition
C. a lack of collusion and the absence of a price leader
D. supplier inertia
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Chapter 21–Question 3
The diamond-water paradox can be explained by the fact that
- the price of water is kept low because access to water is a human right
- diamonds are overpriced
- water is under-priced
- diamonds are expensive because their marginal utility is high
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Chapter 21–Question 4
Menu costs are
A. the costs involved in inviting business partners to a restaurant
B. the costs of printing a new menu
C. all the costs involved in changing prices
D. the costs involved in negotiations
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Chapter 21–Question 5
There are four reasons for price stickiness. Please name them.
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