What Type of Good Is One Whose Quality Can Be

question 23

Multiple Choice

What type of good is one whose quality can be assessed only after the customer has used it for a while?

• A)Apparel
• B)Search good
• C)Experience good
• D)Office furniture
• E)Airline tickets

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Definitions:

Cost-output Elasticity

Cost-output elasticity measures the responsiveness of the cost of production to changes in the quantity of output produced, indicating the scale economies in production.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Marginal Cost

The expenditure required to produce an additional unit of a product.

Short-run Cost Function

An economic formula that describes how production costs change in the short term with varying levels of output, assuming some inputs are fixed.