If a car salesman is paid a fixed salary, the owner is most likely to see
a. A large volume of sales, with large margins
b. A large volume of sales with no margins
c. Low to no sales with low margins
d. Low sales but with large margins
QUESTION 2Which of the following statement is true?
a. The demand for Cheerios is less elastic than the demand for cereal
b. The demand for gas is more elastic in the short-run than in the long-run
c. The demand for puma shoes is more elastic than the demand for shoes
d. Products with many complements have a more elastic demand
QUESTION 3Consider an investment with the following payoffs and probabilities: State of the Economy Probability Return Stability .50 1,000 Good Growth .50 2,000 Determine the expected return for this investment.
a. 1,300
b. 1,500
c. 1,700
d. 2,000
e. 3,000
QUESTION 4If a car salesman is paid a commission on the sale value of the car, the owner is most likely to see
a. Large margins on sales
b. Low margins on sales
c. No sales
d. None of the above
QUESTION 5What is the most likely effect of the development of XBOX with DVD capabilities on the DVD player industry?
a. Increased price elasticity of demand for the DVD player industry because XBOX are complements
b. decreased price elasticity of demand for the DVD player industry because XBOX are complements
c. Increased price elasticity of demand for the DVD player industry because XBOX are substitutes
d. decreased price elasticity of demand for the DVD player industry because XBOX are substitutes
QUESTION 6The number of standard deviations z that a particular value of r is from the mean ? can be computed as z = (r - ?)/ . Suppose that you work as a commission-only insurance agent earning 1,000 per week on average. Suppose that your standard deviation of weekly earnings is 500 . What is the probability that you earn zero in a week? Use the following brief z-table to help with this problem. Z value Probability -3 .0013 -2 .0228 -1 .1587 0 .5000
a. 1.3 chance of earning nothing in a week
b. 2.28 chance of earning nothing in a week
c. 15.87 chance of earning nothing in a week
d. 50 chance of earning nothing in a week
e. none of the above
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