Assume SeatComfy Inc

question 19

Multiple Choice

Assume SeatComfy Inc.estimates the demand for its table chairs to be Q = 5,000 - 25P + 4I +10P_A - 15 P_T,where P = the price of SeatComfy's chairs; P_A = average price of competitors' chairs; P_T = price of tables; and I = average income of SeatComfy's customers.Which of the following is true?

• A)SeatComfy's chairs are inferior goods; SeatComfy's chairs and tables are complements,while SeatComfy's and competitors' chairs are substitutes.SeatComfy's sales decrease by 250 units for each $10 increase in their own price.
• B)SeatComfy's chairs are normal goods; SeatComfy's and competitors' chairs are substitutes,while SeatComfy's sales are not affected by the pricing decisions of table producers.SeatComfy's sales increase by 50 percent if the price decreases by $2.
• C)SeatComfy's chairs are normal goods; SeatComfy's chairs and tables are complements,while SeatComfy's and competitors' chairs are substitutes.SeatComfy's sales decrease by 25 units as price increases by $1.
• D)SeatComfy's chairs are normal goods; SeatComfy's chairs and tables are complements,while SeatComfy's and competitors' chairs are substitutes.SeatComfy's sales decrease by 250 units as price increases by $1.

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Definitions:

Occupational Safety

Refers to the practices, protocols, and regulatory standards aimed at ensuring the physical safety and health of employees in their workplace.

Health Act

Legislation aimed at regulating, managing, and promoting healthcare practices and policies to ensure public health and safety.

Family Medical Leave Act

The Family Medical Leave Act is a U.S. federal law requiring covered employers to provide employees with job-protected, unpaid leave for qualified medical and family reasons.

Fair Labor Standards Act

A United States federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards for full-time and part-time workers.