Question
Michael Spence's cost-minimizing model concludes that this activity contributes to economies of scale. For 10 points each:
[10e] Name this economic activity that may promote welfare by reducing search costs. This activity, a component of marketing, is done to increase the demand for a product and may use commercials.
ANSWER: advertising [or ads or advertisement; prompt on promotion]
[10m] In saturated markets, advertising may operate as this type of cost unrelated to the level of output. These costs often form a barrier to entry.
ANSWER: fixed costs
[10h] Advertising may mitigate or exacerbate this economic situation whose extreme form is a monopoly of knowledge. George Akerlof discussed how this situation leads to adverse selection.
ANSWER: asymmetric information [accept information asymmetry]
<Social Science - Social Science - Economics>
Data
Summary
| Tournament | Edition | Exact Match? | Heard | PPB | Easy % | Medium % | Hard % |
|---|---|---|---|---|---|---|---|
| 2025 PACE NSC | 06/07/2025 | Y | 36 | 15.56 | 100% | 44% | 11% |