Homogeneous oligopoly exists where a small number of firms are:
A. producing virtually identical products.
B. setting price and output independently.
C. setting price and output collusively.
D. producing differentiated products.
Answer: A
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Refer to the above figure. If the market price is equal to A, which statement can be made about profits?
A) Profits are positive and equal to BCEA. B) Profits are positive and equal to BCFG. C) Profits are negative and equal to BCEA. D) Profits are negative and equal to GFQ 0.
A change in the exchange rate for a country's currency alters the prices of
A. Imports only. B. Exports only. C. Both exports and imports. D. Only domestic goods and services.
If the Congress passes legislation to increase government spending to counter the effects of a recession, then this would be an example of a(n):
a. Supply-side fiscal policy b. Contractionary fiscal policy c. Expansionary fiscal policy d. Nondiscretionary fiscal policy
Average total cost is always ____________ average variable cost, but as output rises, the difference between them ____________.
A. greater than; widens B. less than; widens C. greater than; narrows D. less than; narrows