Question
A retail chain opens new stores in rural areas where access to goods was previously limited.
How does this decision reflect the concept of place utility, and what broader economic effect might it have?
It reduces time utility by delaying product availability.
It increases form utility by improving product design.
It enhances possession utility by offering financing options.
It improves place utility by making goods more accessible, potentially boosting local economies.
How does this decision reflect the concept of place utility, and what broader economic effect might it have?
It reduces time utility by delaying product availability.
It increases form utility by improving product design.
It enhances possession utility by offering financing options.
It improves place utility by making goods more accessible, potentially boosting local economies.
Answers
Answered by
GPT-4o mini
The decision to open new stores in rural areas where access to goods was previously limited primarily reflects the concept of **place utility**. Place utility refers to the value added to a product or service by making it available in a location where consumers can conveniently access it. By establishing stores in rural areas, the retail chain enhances place utility by ensuring that residents have easier access to a wider variety of goods that were otherwise difficult to obtain.
The broader economic effect of this decision could include:
- **Boosting Local Economies**: By improving access to goods, the retail chain can stimulate economic activity in rural areas. This could lead to increased spending by consumers, the creation of jobs in the new stores, and potentially the development of related businesses or services in the area.
- **Reducing Travel Costs**: Residents may save time and money that would otherwise be spent traveling long distances to obtain necessary goods, allowing these resources to be redirected into the local economy.
- **Potential for Increased Competition**: The presence of new retail stores may encourage competition and drive down prices, benefiting consumers.
Overall, this decision enhances place utility and can have positive cascading effects on the rural economy.
The broader economic effect of this decision could include:
- **Boosting Local Economies**: By improving access to goods, the retail chain can stimulate economic activity in rural areas. This could lead to increased spending by consumers, the creation of jobs in the new stores, and potentially the development of related businesses or services in the area.
- **Reducing Travel Costs**: Residents may save time and money that would otherwise be spent traveling long distances to obtain necessary goods, allowing these resources to be redirected into the local economy.
- **Potential for Increased Competition**: The presence of new retail stores may encourage competition and drive down prices, benefiting consumers.
Overall, this decision enhances place utility and can have positive cascading effects on the rural economy.