Oscar and Felix are the only firms that clean offices in a large city. They agree to operate as a cartel. The payoff matrix above gives the economic profit that each firm can make
If Felix cheats on the agreement but Oscar complies, Felix makes an economic profit of ________ and Oscar makes an economic profit of ________. A) $10 million; $10 million
B) $1 million; $1 million
C) -$2 million; $12 million
D) $12 million; -$2 million
D
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Suppose the Federal Reserve wanted to reduce the money supply without using open-market operations
It could try to get the public to ________ their currency—deposit ratio and ________ banks' reserve requirements, which would in turn change the banks' reserve—deposit ratio. A) decrease; lower B) decrease; raise C) increase; lower D) increase; raise
Refer to Figure 9.1. If the market is in equilibrium, the consumer surplus earned by the buyer of the 1st unit is ________
A) $5.00 B) $15.00 C) $22.50 D) $40.00
Suppose that a U.S. dollar buys more gold in Australia than it buys in Russia. What does purchasing-power parity imply should happen?
The answer is: "After a policy measure is implemented, it takes time to affect the economy." What is the question?
A) What is the wait-and-see lag? B) What is the data lag? C) What is the effectiveness lag? D) What is the transmission lag? E) What is the legislative lag?