During the Height of the Pet Rock Craze in the 1970s

question 46

Multiple Choice

During the height of the pet rock craze in the 1970s, the price elasticity of demand was estimated to be 1.20.Since pet rocks have a marginal cost of zero, a profit-maximizing seller of pet rocks would

• A)leave prices unchanged.
• B)need more-detailed market information before making any pricing changes.
• C)decrease prices.
• D)increase prices.
• E)diversify into selling Karen Carpenter LPs.

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Definitions:

Durable Sportswear

Durable sportswear refers to athletic clothing designed to withstand rigorous activities and environmental conditions without easily wearing out.

Athletic Shoes

Footwear specifically designed to provide support and comfort for physical exercise and sports activities.

Warranted

Justified or necessitated under the circumstances, or in the context of products, guaranteed to meet specified performance standards.

Shakespeare's Plays

The theatrical works written by William Shakespeare, a renowned English playwright and poet of the 16th and early 17th centuries.