If a Monopolistic Competitor Lowers the Price of Its Product

question 112

Multiple Choice

If a monopolistic competitor lowers the price of its product,

• A)it is a signal that the monopolistic competitor is trying to drive its competition out of the market.
• B)it is a signal that quality has been reduced.
• C)losses will result.
• D)some customers will be drawn from its competitors, ceteris paribus.
• E)it will not be able to advertise and will lose customers.

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Definitions:

Operant Conditioning

A form of learning in which the degree of a behavior is modified by giving reinforcements or implementing disciplinary actions.

Autism

A developmental disorder characterized by difficulties with social interaction and communication, and by restricted and repetitive behavior.

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Cognitive Therapy

A type of psychotherapy aimed at changing negative patterns of thinking to improve mood and behavior.