Answer to Question #184998 in Macroeconomics for James

Question

QUESTION 19

Critics of market-oriented economies argue that society does not really need:

1. Food to survive.
2. Dozens of different automobiles.
3. Any more automobiles.
4. Decision-makers.
5. All of the above.

QUESTION 20

Advertising causes a firm’s perceived demand curve to become:

1. Perfectly inelastic.
2. More inelastic.
3. Engrossed.
4. More elastic.
5. Perfectly elastic.

QUESTION 21

Advertising causes the:

1. Demand for the firm’s product to increase.
2. Demand for the firm’s product to decrease.
3. Supply of a firm’s product to increase.
4. Supply of a firm’s product to decrease.
5. Death of all humankind.

Answer 1

QUESTION 19

Correct answer is: 2. Dozens of different automobiles

The argument is that much of the cost of creating such a high degree of product differentiation, and then of advertising and marketing this differentiation, is socially wasteful

QUESTION 20

correct answer is: 2. more inelastic

A successful advertising campaign may allow a firm to sell either a greater quantity or to charge a higher price, or both, and thus increase its profits.

QUESTION 21

correct answer is: 1. Demand for the firm's product to increase.

A successful advertising campaign may allow a firm to sell either a greater quantity.