Use the Following to Answer Questions

question 130

Multiple Choice

Use the following to answer questions:
-(Table: Demand and Total Cost) Look at the table Demand and Total Cost. Lenoia runs a natural monopoly firm producing electricity for a small mountain village. The table shows Lenoia's demand and total cost of producing electricity. To maximize profits, Lenoia should charge a price of:

• A) $350.
• B) $400.
• C) $450.
• D) $500.

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Definitions:

Negative Contrast Effect

The effect in which a shift from high to low reward magnitude produces a lower level of responding than if the reward magnitude had always been low.

Reward

A beneficial stimulus that increases the likelihood of a behavior being repeated when it follows that behavior.

Variable-interval Schedule

A reinforcement schedule in which rewards are given following a variable amount of time.

Responding

The act of reacting to a stimulus or situation, often used in the context of behavioral psychology.