Refer to the graph shown, which depicts a perfectly competitive firm. When maximizing profit, the firm represented will earn per-unit profit roughly equal to:
A. $10.
B. $7.50
C. $5.
D. $2.00.
Answer: D
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In the above figure, the monopolistically competitive firm produces
A) Q3 and sets the price at P3. B) Q2 and sets the price at P2. C) Q1 and sets the price at P1. D) Q1 and sets the price at P5.
A recessionary gap refers to the gap between real GDP and potential GDP when the level of output is above the level of potential GDP
a. True b. False Indicate whether the statement is true or false
A consequence of an inflationary gap is ____ as output begins to decrease and prices continue to increase.
A. stagflation B. reflation C. disinflation D. perflation
Suppose Firm A and Firm B are considering whether to invest in a new production technology. For each firm, the payoff to investing (given in thousands of dollars per day) depends upon whether the other firm invests, as shown in the payoff matrix below. 
Is this game a prisoner's dilemma?
A. No. B. Yes. C. It cannot be determined. D. Only when both Firm A and Firm B invest.