Related to the Economics in Practice on P

question 264

Multiple Choice

Related to the Economics in Practice on p. 129: Suppose Store ABC runs an ad claiming to have "low prices everyday." They even demonstrate that the total expenditure for a basket of groceries is less at their store than at any of their competitors. Which of the following statements is not true?

• A) You would clearly be better off shopping at Store ABC.
• B) Your preferences may not be consistent with the basket used by Store ABC (in their example), thus it is not clear whether or not you would be better off shopping at Store ABC or not.
• C) Even if your preferences are generally consistent with the basket used by Store ABC, it may still be possible for you to substitute other similar goods for those in the basket used by Store ABC (in their example) and thus spend less at another store.
• D) All of the above statements are true.

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Definitions:

India

A country in South Asia, known for its diverse cultures, languages, and histories, and as the second-most populous country in the world.

Netherlands

A country in Northwestern Europe known for its flat landscape, extensive canal system, windmills, tulip fields, and cycling routes.

Hunter-Gatherer Societies

Communities that subsist by hunting, fishing, and harvesting wild food, often with nomadic lifestyles.

Recuperate

To recover or regain health, strength, or energy after illness, injury, or exertion.