Todd, Who Graduated with a Degree in History, Has Prolonged

question 25

Multiple Choice

Todd, who graduated with a degree in History, has prolonged, relevant experience and significant on- the-job training as a real estate agent. You want to buy a condo and so you consider asking Todd to be your agent. This will be the first time you ever bought real estate. Todd agrees to represent you and then shows you three condos in your price range. Although he does not tell you this, Todd owns two of the three himself. In this situation is Todd an expert whom you would be wise to trust to give you advice and information about buying a condo?

• A) Yes, Todd is an experienced real estate agent speaking on topic.
• B) No, Todd majored in History, not Business.
• C) No, Todd may be biased against you as a first time buyer.
• D) No, Todd has a conflict of interest.

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Definitions:

Short Run

A period in which at least one of a firm's inputs is fixed, limiting its capacity to adjust its output levels.

Long Run

A period of time in which all factors of production and costs are variable, allowing firms to adjust all inputs.

Marginal Cost

The cost of producing one additional unit of a good or service.

Marginal Revenue

The additional income that an organization receives from selling one more unit of a product or service.