In Their Surveys of Consumers, Daniel Kahneman, Jack Knetsch and Richard

question 167

Multiple Choice

In their surveys of consumers, Daniel Kahneman, Jack Knetsch and Richard Thaler found that

• A)most people considered it unfair for firms to raise their prices because of an increase in their costs, but fair to raise their prices after an increase in demand.
• B)most people considered any increase in price to be unfair as it led to an increase in profits.
• C)most people believed that low-income people were hurt most by increases in prices.
• D)most people considered an increase in price by firms following an increase in their costs to be fair but believed it was unfair for firms to raise their prices because of an increase in demand.

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Definitions:

Stockholders

Individuals or entities that own stock in a corporation, giving them ownership interests and rights such as voting on corporate matters.

Total Interest Expense

The sum of all interest payments made by a company over a reporting period, typically for borrowing funds.

Interest Payments

Regular payments made to lenders or bondholders as compensation for borrowing money, typically calculated as a percentage of the principal amount.

Total Discount

The complete reduction from the usual price of goods or services, often applied cumulatively or as a summation of various discount types.