A Car Sells at Different Prices at Different Dealerships in an Oligopolistic

question 29

Multiple Choice

A car sells at different prices at different dealerships in an oligopolistic market.If a consumer has imperfect information about the price of a car at each dealership, the consumer should

• A)always gather all available information about prices.
• B)gather information about prices until the expected marginal utility of more information equals the marginal cost of gathering it.
• C)gather information about prices only if it can be gathered without cost.
• D)ignore information about prices because it is irrelevant to making an "optimally imperfect" decision.

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Definitions:

Racetrack Gamblers

A term referring to individuals who regularly engage in betting on horse races, often used in studies of decision-making and probability assessment.

Predictive

Relating to the ability or act of making predictions based on data, patterns, or trends.

Correlated

When two variables are found to have a statistical relationship with each other, meaning changes in one variable are associated with changes in another.

IQ Score

A measure of a person's cognitive abilities in relation to their age group, calculated through various standardized tests.