Rhonda Is Suspicious About Adam's Statement That His Company Cannot

question 38

Multiple Choice

Rhonda is suspicious about Adam's statement that his company cannot afford her product. Her precall research on the firm suggested not only do they need the new piece of equipment, but also that financing can be obtained from a local bank. In fact, the more she thinks about it, there was something about the tone of his voice that makes her believe this was just a(n) _____ to hide his real objection to buying.

• A)explanation
• B)excuse
• C)motive
• D)thought
• E)objective

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Definitions:

Marginal Benefit

The maximum price a consumer will be willing to pay for an additional unit of a product. It is the dollar value of the consumer’s marginal utility from the additional unit, and therefore it falls as consumption increases.

Opportunity Cost

The loss of potential gain from other alternatives when one alternative is chosen over others.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount they actually do pay.

Price Elasticity

The determination of how price alterations influence the market demand for a commodity.