A high-priced food store replaced a discount grocery in an urban neigh

QUESTION

A high-priced food store replaced a discount grocery in an urban neighborhood. Older residents could not afford the higher prices, so the community organized a boycott. For months the new store was almost empty.

Finally, management agreed to lower its prices, and shoppers returned. What is at work here?
A) monopolistic competition
B) consumer sovereignty
C) economies of scale
D) buyer-seller irrationality
E) oligopoly

ANSWER

Answer: B
Explanation: B) Under this principle, consumers influence the marketplace through their purchasing decisions. Not purchasing from the high-end store forced it to lower prices.