Question

QUESTION 13 According to the indifference principle housing prices a tend to converge over time b tend to leave individuals indifferent about where they live c. only tend to be different to compensate individuals for differences in living conditions od only B&C QUESTION 14 You operate a small poultry farm in east Texas. You sell most of your output through a regional distributor of poultry products in the area. In this case, you are subject to a Low buyer power Ob High buyer power No buyer power d. All of the above

Answer 1

13) Indifference principle states that people tend to choose one alternative to another till he is indifferent between them. In case of housing prices, the buyer would tend to choose one over another till the time the prices would converge and the individuals are indifferent as to which location to choose for living.

Hence answer is option D) both B and C

14) Selling most output through regional distributors means that the farmer would be dependent for his sale on the distributor. This would imply that there would be more power to buyer or the distributor who acts as a buyer for the poultry farmer. Also the farmer owns a small farm, so the influence on the buyer would be less.

This would mean there is high buyer power in this case. Answer is option B) High buyer power

15) The consumer confidence reduced implies that there would be a decrease in demand for normal goods and services.Hence the demand curve would shift to left or inwards.

Answer is option A)to the left.

16) The price would increase when the demand would increase and supply is the same, when demand is the same and supply decreases and when supply reduces and demand increases.

Hence in all the above cases, the price would increase. Answer is option D) All the above.