04 Jun http://wps.pearsoncustom.com/wps/media/styles/
Question
Quiz 4
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Question 1.
When advertising gives information about the features of a product it is:
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persuasive advertising and is probably promoting a search good.
persuasive advertising and is probably promoting an experience good.
informational advertising and is probably promoting an experience good.
informational advertising and is probably promoting a search good.
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http://wps.pearsoncustom.com/wps/media/styles/1480/_skins_/D/default_blue/ps_bkgd_lower_left.gif
End of question 1
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http://wps.pearsoncustom.com/wps/media/styles/1480/_skins_/D/default_blue/ps_bkgd_upper_right.gif
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Question 2.
Critics of monopolistically competitive firms and industries argue that these industries are inefficient and waste resources. One of the developers of the model of monopolistic competition, Edward Chamberlin,
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argued that the higher costs of monopolistic competition when compared to perfect competition were a cost consumers willingly pay to have a variety of goods.
agreed completely with this assessment.
agreed that advertising was wasteful but argued that the firms were not inefficient because they produced at the minimum point of their average total cost curves.
agreed that firms produced too little but claimed that firms were efficient since price equaled marginal cost.
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