Suppose the Market for "Soda X" Is in Equilibrium

question 30

Multiple Choice

Suppose the market for "soda X" is in equilibrium. If the FDA announced today that this soda has been proven to cause a fatal disease, what would be most likely to happen to the equilibrium price and equilibrium quantity of soda X?

• A) Price increases and quantity increases
• B) Price decreases and quantity increases.
• C) Price increases and quantity increases.
• D) Price decreases and quantity decreases
• E) No change in price and quantity

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Definitions:

Intimidation

The act of making someone feel frightened or overawed, especially in order to make them do what one wants.

Impression Management

Usually conscious efforts by people to influence how others think of them.

Ingratiation

A psychological technique where an individual attempts to become more likable to their target, often through flattery or other forms of manipulation.

Self-monitoring

The process of observing and regulating one's own behavior in social situations to fit social norms or expectations.