If firms follow a low-price guarantee strategy, the price that will prevail in the market will be closest to:
A. the price a monopolist will pick.
B. the price that a perfectly competitive firm would pick.
C. the duopoly price.
D. the price that would yield zero economic profits.
Answer: A
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Marginal revenue is defined as
A. the change in total revenue from a unit change in price. B. the change in average revenue from a one-unit change in output. C. the change in total revenue from a one-unit change in output. D. the change total cost from a one-unit change in output.
Unexpected inflation redistributes income:
a. away from workers with cost-of-living adjustments, benefiting employers. b. away from renters, benefiting landlords. c. away from poor people, benefiting the rich. d. away from people with fixed incomes, benefiting people with fixed costs. e. away from debtors, benefiting creditors.
Total surplus in a market does not change when the government imposes a tax on that market because the loss of consumer surplus and producer surplus is equal to the gain of government revenue
a. True b. False Indicate whether the statement is true or false
A contractionary monetary policy is likely to lead to ________
A) lower real interest rates B) lower real wages C) a lower demand for labor D) a lower supply of labor