The welfare loss associated with the outcome in a colluding oligopoly is:
A. smaller than that of a perfectly competitive outcome.
B. smaller than that of a competitive oligopoly.
C. the same as that of a perfectly competitive outcome.
D. None of these statements is true.
D. None of these statements is true.
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If the desired reserve ratio is 7 percent and a bank has $10,000 of deposits, then its desired reserves are
A) $7. B) $700. C) $9,300. D) $930. E) $7,000.
A bank creates money by
A) lending its excess reserves. B) purchasing currency from the Federal Reserve. C) buying bonds from the Federal Reserve. D) printing more checks.
The amount of gross investment in the economy depends on the
A) response of expected output to the error in estimating the past period's actual output. B) amount of the difference between the desired capital stock and last period's capital stock that can be put in place this period. C) fraction of the capital stock that is replaced each period. D) All of the above are correct.
An increase in net working capital required at the beginning of an expansion project must be considered to be
A) a cash inflow. B) a reallocation of assets. C) a cash outflow. D) None of the above