A monopsony is a market situation in which there is only one buyer
a. True
b. False
Indicate whether the statement is true or false
True
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The local diner is usually jammed on Saturday mornings. Luke knows the owner and had him reserve a stool at the counter. Luke has
A) cooperated with the owner. B) competed with other customers. C) taken an efficient course of action, from his own perspective. D) engaged in all of the above.
The base year in the consumer price index (CPI) is:
a. given a value of zero. b. a year chosen as a reference for prices in all other years. c. always the first year in the current decade. d. established by law.
When economists say that market equilibrium is consistent with economic efficiency, they mean
a. the total gains from trade (the combined area of producer and consumer surplus) are smaller than potentially could be the case at a different price and quantity. b. all units creating more benefit than cost have been produced. c. some units have been produced that cost more than the benefits they create. d. consumers and producers have made decisions without properly taking into account the market price.
In a repeated? game, deterring entry
A) is not possible.
B) is not a rational strategy if money is lost fighting the first potential entrant.
C) may require losing money fighting the first potential entrant.
D) cannot form a subgame perfect Nash equilibrium.