In their surveys of consumers, Daniel Kaheman, Jack Knetsch and Richard Thaler found that
A)most people considered it unfair for firms to raise their prices because of an increase in their costs, but fair to raise their prices after an increase in demand.
B)most people considered any increase in price to be unfair as it led to an increase in profits.
C)most people believed that low-income people were hurt most by increases in prices.
D)most people considered an increase in price by firms following an increase in their costs to be fair but believed it was unfair for firms to raise their prices because of an increase in demand.

Question

Quizplus · Accepted Answer

In their surveys, Kaheman, Knetsch, and Thaler found that most people considered it fair for firms to raise their prices after an increase in costs, but unfair for them to raise their prices due to an increase in demand. This choice is reflected in option D. Options A and C are incorrect, as they do not accurately reflect the findings of the survey. Option B is also incorrect, as the survey showed that not all people considered any increase in price to be unfair.

In Their Surveys of Consumers, Daniel Kaheman, Jack Knetsch and Richard