Question

True and False question: (I will be grateful if you could give a short explanation of the answer to each question.)

1. In an English auction, the equilibrium price of a piece of art is determined by the highest bid.

1. True               (b) False

2. The only reason people go to the opera is to appreciate the show.

1. True               (b) False

3. Perfect competition is a good model to explain the market for art.

1. True             (b) False

4. Works produced by an artist will lose their value after his death unless he is well-known during his life-time.

1. True             (b) False

                 

5. A profit-maximizing museum will set its admission price at a point where the demand is inelastic.

1. True              (b) False

6. The cross-elasticity of demand between CDs and the subscription price for online music is positive.

1. True             (b) False

7. The demand for expensive cultural goods may contain an element of conspicuous consumption.

1. True            (b) False

8. If the income elasticity of demand for a cultural product is positive but less than one, an increase in the consumer’s income will bring about an increase in the proportion of his income spent on the product.

1. True            (b) False         

9. The expression “De gustibus non est disputandum” suggests that culture is a shared phenomenon.

(a)True              (b) False

10. Bonnie is a music lover. She used to go to a concert only once a year because she had to spend most of her budget on rent and food. Two months ago, she was given a promotion and her salary doubled. She started going to a concert every week. The change in her behaviour can be explained by a shift in her demand curve for concerts.

1. True            (b) False

Answer 1

The explanations and solutions are given in the attachment.