Use the Information Below to Answer the Following Questions

question 82

Multiple Choice

Use the information below to answer the following questions.
Fact 13.3.2
Suppose that Tommy Hilfiger's marginal cost of a jacket is $100 (a constant marginal cost) and at one of the firm's shops,total fixed cost is $2,000 a day.The profit-maximizing number of jackets sold in this shop is 20 a day.Then the shops nearby start to advertise their jackets.The Tommy Hilfiger shop now spends $2,000 a day advertising its jackets,and its profit-maximizing number of jackets sold jumps to 50 a day.
-Refer to Fact 13.3.2.Having a brand name helps Tommy Hilfiger increase its economic profit because

• A)the goal of a brand name is to encourage people to buy just one good.After the initial purchases,Tommy Hilfiger can decrease quality and produce goods at a lower average total cost,which increases economic profit.
• B)in every type of market,consumers are most comfortable when buying from a firm with a well-known brand name.And the greater the number of consumers,the greater is the economic profit.
• C)a brand name provides an incentive to achieve high and consistent quality,and consumers will purchase goods from Tommy Hilfiger rather than from an unknown producer because they know what to expect from Tommy Hilfiger.
• D)having a brand name usually leads to a monopoly.
• E)having a brand name lowers total variable cost.

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Definitions:

Social Loafing

The occurrence when people put in less effort towards attaining an objective while working in a team compared to working solo.

Meaningful Task

A task perceived as significant and valuable by an individual, often leading to increased motivation and engagement.

Social Loafing

The phenomenon where individuals exert less effort to achieve a goal when they work in a group than when they work alone.

Identifiable Contributions

Specific inputs or efforts by individuals or groups that can be directly linked to a particular outcome or result.