(Figure: Demand Shift) Which of the Following Factors Would Cause

question 54

Multiple Choice

(Figure: Demand Shift) Which of the following factors would cause the change in the figure? Figure: Demand Shift I. an increase in the price of a complement good II. an increase in production costs III. an increase in the price of a substitute good IV. an increase in income for an inferior good

• A) I and III only
• B) II and IV only
• C) III only
• D) I, II, and III

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Definitions:

Repeated Games

A series of game theory scenarios in which the same game is played multiple times, allowing for strategy development based on previous outcomes.

Reciprocity

A mutual exchange of privileges, goods, or services between two parties, based on a principle of giving and receiving in equal measure.

Payoffs

The returns or benefits received from a particular action or investment.

Kinked-Demand Curve

A theory in economics suggesting that a firm's price will be rigid and unlikely to change because competitors will match price decreases but not price increases.