Firms A, B, and C Operate in the Market for Computers

question 102

Multiple Choice

Firms A, B, and C operate in the market for computers. Each firm's product is popular in the market and distinct from what the other firms offer. The following table shows the prices of laptops from 2005 through 2007. If 2005 is used as the base year, which of the following statements about the prices of these laptops is true?

• A) The prices increased by about 4.8% between 2006 and 2007.
• B) The prices were about 8.17% lower in 2007 than in 2005.
• C) The prices increased by about 3.36% from 2005 to 2006.
• D) The increase in the price of firm C's laptop outweighed the fall in the prices of the others so that the overall index for 2006 was greater than 100.

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Definitions:

Democracy

A form of government in which power is vested in the people, who rule either directly or through freely elected representatives.

Existing Research

Prior studies or investigations conducted on a particular topic or field.

Milgram

Refers to Stanley Milgram, a psychologist known for his research on obedience to authority, notably his controversial experiment in the 1960s.

Agricultural Societies

Societies that rely on agriculture as their primary means for support and sustenance, cultivating plants and domesticating animals.