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Shin Bicycles Makes Reproduction Cruisers Just Like Kids Rode in the 1950s

Question 257

Multiple Choice

Shin Bicycles makes reproduction cruisers just like kids rode in the 1950s. The firm primarily uses steel to make the bikes with only a small amount of plastic. The cost of producing each bike is highly sensitive to steel prices and relatively insensitive to the price of plastic. The slope of the firm's risk profile with regard to ________ will, therefore, be ______ its risk profile with regard to __________.


A) plastic; steeper than; steel
B) steel; flatter than; plastic
C) steel; either flatter or steeper than (we can't tell which) ; plastic
D) plastic; the same as; steel
E) plastic; flatter than; steel

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