You Explain to Your Roommate Surya, Who Makes Beaded Headbands

question 163

Multiple Choice

You explain to your roommate Surya, who makes beaded headbands, about an economic theory which asserts that consumers will purchase more of a product at lower prices than they will at higher prices.She contends that the theory is incorrect because over the past two years she has lowered the price of her headbands and yet has seen a decrease in sales.How would you respond to Surya?

• A)Surya is right; she has evidence to back her claim. The theory must be erroneous.
• B)Surya is making the mistake of assuming that correlation implies causation.
• C)I will explain to her that she is making the error of reverse causality: it is the decrease in demand that has caused her to lower her prices.
• D)I will explain to her that there are some omitted variables that have contributed to a decrease in her sales such as changes in income.

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Definitions:

Ras Proteins

A family of proteins involved in transmitting signals within cells, playing key roles in the regulation of cell division, growth, and differentiation.

G Proteins

A family of proteins that act as molecular switches inside cells, involved in transmitting signals from stimuli outside the cell to its interior.

MAP Kinases

A family of proteins that play a critical role in transmitting signals from the cell surface to the nucleus, affecting cellular activities like division, differentiation, and response to environmental stimuli.

Calmodulin

A calcium-binding messenger protein that plays a key role in cellular processes by activating enzymes, ion channels, and other proteins.