Which of the Following Statements Is Correct

question 162

Multiple Choice

Which of the following statements is correct?

• A)If the buyer of a good gains, the seller must lose an equal amount.
• B)The value of goods is objective; it is equal to the cost of supplying the good.
• C)Opportunity costs will always be incurred when scarce resources are used to produce a good.
• D)Changes in incentives generally have no effect on human behavior.

---

Definitions:

Differentiated Products

Products that are distinguished from others through variations in quality, features, design, branding, or customer service.

Equilibrium Price

The market price at which the quantity of goods supplied is equal to the quantity of goods demanded.

Reaction Curve

A graph that shows how one player's optimal strategy choice depends on the strategy choice of another player.

Bertrand Model

An economic model of competition among firms in which they simultaneously choose prices rather than quantities, with the assumption that consumers choose the firm with the lowest price.