Use the Following Scenario to Answer the Following Questions

question 56

Multiple Choice

Use the following scenario to answer the following questions:
In 2011,three firms were selling cellular phone service for a price of $40 per month in Pittsburgh,Pennsylvania.Each firm serviced 100 cell phone customers; thus,all firms together serviced a total of 300 customers.In 2012,five firms were selling cellular phone service for a price of $30 per month.Each firm serviced 70 cell phone customers; thus,all firms together serviced a total of 350 customers.Assume marginal cost is $0 (zero) for all firms and thus total revenue is equal to total profit.
-Due to the entrance of two firms in 2012,total monthly profits for all firms in the market decreased by $3,000 due to the ________ effect and increased by $1,500 due to the ________ effect.

• A)
• Price; output
• B) output; price
• C) price; price
• D) output; output
• E) competitive; noncompetitive

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Definitions:

Positive Punishment

A form of behavior modification where something unfavorable is added after a behavior, with the intention of decreasing the likelihood of that behavior being repeated.

Observational Learning

Learning that occurs through observing the behaviors of others and imitating those behaviors without direct instruction or reinforcement.

Operant Conditioning

A process of teaching in which behavior modification occurs as a result of either encouraging rewards or imposing punishments.

Ivan Pavlov

A Russian physiologist known for his work in classical conditioning, demonstrating how stimuli can trigger conditioned responses.