Write an essay on Consumer Behaviors

1- Give examples of Search, Experience and Credence goods. For your
Experience and Credence goods, argue what is the best way for
consumers to gather information about the goods.

Short answers

1. Can a market be vertically differentiated and horizontally differentiated at the
same time? If not, why not? If so, give some examples.

2. Which of the following meet the economic definition of an informative signal?
(a) A man asks for a woman’s hand in marriage and gives her a large diamond ring.
(b) The same man takes his fiancée for a walk along the beach where he promises
he will stop driving fast cars.
(c) The same woman promises her employer that she will finish an important
report before the wedding date.
(d) The woman offers to accept a lower salary in exchange for a large bonus if she
meets the completion deadline.

3. In the United States, most hospitals are nonprofit, but nearly all pharmaceutical
firms are for-profit. Can you offer an explanation based on the consumer shopping
problem?

4. A former dean of the Kellogg School of Management used to warn faculty not to
gloat about the school’s #1 ranking in Business Week. Why do you suppose he
issued this warning?

5. What strategies do college students employ in order to “game” their academic
report cards? In light of this gaming, how can prospective employers and graduate
schools determine the true academic performance of undergraduates?

Answer preview:

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