Refer to Scenario 12.3. What will be the price of this new drink in the long run if the industry is a Bertrand duopoly?
A) $3
B) $9
C) $12
D) $13.50
E) none of the above
A
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The change in total planned real expenditures resulting from a change in the real value of money balances when the price level changes, all other things held constant, is
A) the real-balance effect. B) the interest rate effect. C) the open economy effect. D) demand side inflation.
(Consider This) Darcy and Rachel live down the hall from each other in the same dorm. Darcy likes to play her music loudly down the hall, and Rachel finds the music annoying. A Coase theorem solution for this problem would be for:
A. Darcy and Rachel to negotiate a mutually agreeable level of volume and/or selection of music. B. the director of housing to impose a fine on Darcy whenever she plays her music too loud. C. the dorm government to set a payment schedule by which Rachel would compensate Darcy for making her play her music at a lower volume. D. the college to ban the playing of music in dorms.
Some politicians argue that reducing the corporate income tax will increase business investment spending.
Answer the following statement true (T) or false (F)
The story in the textbook about helium, hydrogen, and the German zeppelin program is meant to illustrate the importance of
a. patents b. potential entry c. acquisition of competitors d. exclusive access to resources e. oligopoly