The market for bagels contains two firms: BagelWorld (BW) and Bagels'R'Us (BRU). The owners of the two firms decide to fix the price of bagels. The table below shows how each firm's profit (in dollars) depends on whether they abide by the agreement or cheat on the agreement. 
For Bagel World, ________ is a ________.
A. abiding by the agreement; dominant strategy when Bagels'R'Us also abides
B. abiding by the agreement; dominant strategy
C. cheating on the agreement; dominant strategy
D. cheating on the agreement; dominated strategy
Answer: C
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The reason that you don't drink five cups of coffee at breakfast is that
a. the marginal utility of extra cups of coffee eventually diminishes b. most people cannot afford five cups c. the total utility of coffee rises as you consume more cups d. the price of coffee rises as you buy more cups e. the marginal satisfaction derived from cups of coffee remains constant
At a given output level, a monopolist earns a profit only if the
a. slope of its TR curve exceeds the slope of his TC curve. b. height of its MR curve exceeds the height of his MC curve. c. height of its demand curve exceeds the height of his MR curve. d. height of its demand curve exceeds the height of his ATC curve.
Expansionary monetary policy in a flexible exchange rate regime will cause
A) a shift of the IP curve. B) an appreciation of the domestic currency. C) a reduction in E. D) no change in E.
Ahmed is working and is spending more than he is earning by using his savings to make up the difference. Which of the following statements is TRUE?
A. Ahmed is in equilibrium since he pays all of his bills. B. Ahmed is in disequilibrium. C. By using savings Ahmed has caused the balance of payments to go into a deficit situation. D. By using savings Ahmed is using special drawing rights.