Use the Information Below to Answer the Following Questions

question 96

Multiple Choice

Use the information below to answer the following questions.
Fact 13.3.3
Suppose that Roots' marginal cost of a jacket is a constant $125.00 and the total fixed cost at one of its stores is $1,500 a day.This store sells 20 jackets a day,which is its profit-maximizing number of jackets.Then the stores nearby start to advertise their jackets.The Roots store now spends $2,000 a day advertising its jackets,and its profit-maximizing number of jackets sold jumps to 70 a day.
-Refer to Fact 13.3.3.If the nearby firms' advertising decreases the demand for Roots' jackets and makes the demand more elastic,the price of a Roots' jacket ________.If Roots' advertising increases the demand for Roots' jackets and makes the demand less elastic,the price of a Roots' jacket ________.

• A)falls;rises
• B)rises;rises
• C)rises;falls
• D)falls;falls
• E)does not change;does not change

Identify conditions that lead to a market surplus or shortage.

Recognize the factors influencing shifts in supply and demand curves.

Differentiate between shortage and scarcity.

Analyze the effects of price setting on market equilibrium.

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Definitions:

Serious Crime

An act, typically involving violence, regarded by society as being particularly harmful or dangerous, and punishable by severe penalties including imprisonment.

Probation

A period of supervision over an offender, ordered by a court instead of serving time in prison, allowing the person to remain in the community under specific conditions.

Conditional Sentence

A form of judicial punishment that allows an offender to serve a sentence outside of custody, under specific conditions.

Wireless Internet

A method of accessing the internet without the need for physical connections, using radiofrequency waves to transmit data.