Whether or Not a Pooling Equilibrium Exists in a Competitive

question 6

True/False

Whether or not a pooling equilibrium exists in a competitive market with adverse selection depends on what fraction of consumers is of the high cost type and what fraction is of the low cost type.

Understand the role of descriptive and injunctive norms in shaping consumer behaviour.

Identify obstacles to predicting behaviour with the theory of reasoned action and the Fishbein models.

Appreciate modifications made to the original Fishbein model to improve attitude-behaviour predictions.

Understand and describe the concept of descriptive norms.

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Definitions:

Exclusive Dealing Contracts

Agreements where a retailer or distributor is obligated to buy from only the contracted supplier, thereby limiting the retailer's ability to purchase from other vendors.

Sufficient Consideration

A vital element in contract law, referring to something of value exchanged between parties that is necessary to form a legally binding agreement.

UCC

Uniform Commercial Code, a comprehensive set of laws governing commercial transactions in the United States.

New Consideration

In contract law, additional or different terms, conditions, or considerations offered upon renegotiating or amending an existing agreement.