Tom Has Left Home and Is Attending College in a City

question 50

Multiple Choice

Tom has left home and is attending college in a city far away from home where he doesn't know anybody.According to the principle of proximity, Tom will be most likely to make friends with

• A)Bill, his roommate.
• B)John, who lives across campus.
• C)Michael, who lives in the same dorm but two floors below Tom.
• D)Stuart, who lives in the adjacent room.

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Definitions:

Elasticity Of Demand

An indicator of the sensitivity of demand for a product to fluctuations in its price.

Marginal Cost

The additional total expense that results from the creation of one more unit of a product or service.

Monopoly Power

The ability of a single seller to control prices and total market supply in an industry.

Social Cost

The total cost to society, including both private costs borne by individuals and external costs affecting others not directly involved in a transaction.