You Are the Manager of a Local Flower Shop and You

question 71

Multiple Choice

You are the manager of a local flower shop and you compete with one other flower shop in your area. You estimate the cross- price elasticity of demand between your flowers and your competitor's flowers to be 2.60. Using this information, which of the following statements is true?

• A)The flowers from the two shops are substitutes.
• B)The flowers from the two shops are complements.
• C)If your competitor decreases the price of her flowers, the demand for your flowers will increase.
• D)If your competitor increases the price of her flowers, the demand for your flowers will decrease.

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Definitions:

Recentering

The process of shifting focus or importance back towards a central idea, issue, or geographical location.

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A measure of an individual's ability to understand and adapt to new cultural contexts, enhancing their effectiveness in international and diverse environments.

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Information that is not readily available or known to the public, often providing a competitive edge in decision making or investments.

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