Some Consumer Electronics Products Such as Plasma TVs, DVD Players

question 217

Multiple Choice

Some consumer electronics products such as plasma TVs, DVD players, and digital cameras, are introduced at very high prices but over time, their prices start falling (beyond what could be attributed to falling costs as companies take advantage of economies of scale and cheaper technologies) .Which of the following is the best explanation for this observation?

• A)More firms are likely to enter the consumer electronics market over time, forcing market prices down.
• B)Early adopters of these new products typically have a higher demand and higher income compared to those who are willing to wait.
• C)Early adopters are more quality conscious and are willing to pay higher prices for the initial production of these goods.
• D)After satisfying the demand for early adopters, firms lower price to attract the more price-sensitive consumers.

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Definitions:

Industry

Refers to the production of goods or services within an economy, categorized into sectors such as manufacturing, services, and agriculture.

Firms

Business organizations engaged in offering goods or services to consumers, often characterized by the ownership structure and size.

Concentrated

Concentrated refers to a situation or market in which a few firms hold a large market share, leading to reduced competition and higher barriers to entry.

Industry X

A placeholder name used for referring to a specific but unnamed industry or sector in a generic context.