When a fixed charge is included in the price of high and low quality goods, more high quality goods are consumed because:
A)high quality just got more expensive.
B)people like high quality.
C)the relative price of high quality goods is higher.
D)the relative price of high quality goods is lower.

Question

Quizplus · Accepted Answer

The inclusion of a fixed charge in the price of goods makes high-quality goods relatively cheaper compared to low-quality goods. This is because the fixed charge represents a smaller proportion of the total cost for high-quality goods than for low-quality goods, effectively lowering the relative price of high-quality goods and making them more attractive to consumers.

When a Fixed Charge Is Included in the Price of High