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Question
The introduction of new gaming systems that can compete effectively with the Nintendo console will make the demand for the Nintendo console become
a. more price elastic.
b. more price inelastic.
c. perfectly price elastic.
d. perfectly price inelastic.
e. unchanged.
Answer
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Suppose Solomon lives in a community with no price controls. What do you expect will happen if his town borders a community where there is a binding price ceiling on most products?
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