Suppose That Two Types of Indistinguishable Coffee Beans Are Imported

question 72

Multiple Choice

Suppose that two types of indistinguishable coffee beans are imported to the U.S.: those grown in the mountains of South America and those grown in greenhouses in Canada.Mountain grown coffee produces a better tasting coffee,but buyers cannot distinguish the beans by sight or smell.Only the importers know the source of the beans.Buyers value mountain grown beans at $10 a pound and greenhouse grown beans at $3 a pound.Assume that 70% of imported beans are mountain grown,and 30% are greenhouse grown.
Mountain grown beans will ________ unless importers can _______

• A)disappear from the market;trick buyers.
• B)dominate the market;increase imports from Canada.
• C)dominate the market;reduce the price of Canadian beans.
• D)disappear from the market;credibly signal their source.

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Definitions:

Collectivist Country

A country that prioritizes the collective over the individual, often emphasizing community, collaboration, and shared responsibility.

Individualist Country

A society characterized by a cultural orientation that emphasizes personal independence and the self over the group.

Conform

To align one's behavior or beliefs with group norms or expectations, often as a result of real or imagined group pressure.

Conformity Causes

Factors that lead individuals to change their attitudes, beliefs, or behaviors to align with group norms or expectations.