Refer to the Diagram, Which Shows the Domestic Demand and Supply

question 80

Multiple Choice

Refer to the diagram, which shows the domestic demand and supply curves for a specific standardized product in a particular nation. If the world price for this product is $0.50, this nation will experience a domestic

• A)shortage of 160 units, which it will meet with 160 units of imports.
• B)shortage of 160 units, which will increase the domestic price to $1.60.
• C)surplus of 160 units, which it will export.
• D)surplus of 160 units, which will reduce the world price to $1.00.

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Definitions:

Lowballing

A sales and negotiation tactic where an initial, lower price is offered to entice a buyer, before it is subsequently raised once the buyer is interested or committed.

Mere Exposure

A mental effect where individuals grow fond of things simply because they are accustomed to them.

Reciprocal Helping

A cooperative behavior where an individual helps another with the expectation that the favor will be returned in the future.

Altruism

The act of providing help when it is needed, with no apparent reward for doing so.