Price Wars Among fiRms

question 207

Multiple Choice

Price wars among firms

• A) tend to reduce short-run price stickiness because firms know they can lower their own prices without rival firms lowering their prices.
• B) occur when one firm lowers its price and rival firms react by lowering their prices.
• C) occur when firms use advertising to take customers away from rival firms.
• D) have no effect on the degree of short-run price stickiness.

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Definitions:

Acid-Base Buffers

Solutions that minimize changes in pH when an acid or base is added, helping to maintain a stable environment in biological systems.

Open Circulatory System

A type of circulatory system where blood is not always contained within vessels but flows freely through cavities in the body.

Pumping Organ

This usually refers to the heart, an organ responsible for circulating blood throughout the body by rhythmic contraction and dilation.

Arteries

Blood vessels that carry oxygen-rich blood away from the heart to all parts of the body.