Which of the following is a characteristic of perfect competition?
A) easy entry and exit
B) few firms
C) differentiated products
D) none of the above
Answer: A
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The market for bagels contains two firms: BagelWorld (BW) and Bagels'R'Us (BRU). The owners of the two firms decide to fix the price of bagels. The table below shows how each firm's profit (in dollars) depends on whether they abide by the agreement or cheat on the agreement. 
For Bagel World, ________ is a ________.
A. abiding by the agreement; dominant strategy when Bagels'R'Us also abides B. abiding by the agreement; dominant strategy C. cheating on the agreement; dominant strategy D. cheating on the agreement; dominated strategy
A car leasing company that expands its size by buying its competitors may run the risk of increasing production costs due to
a. diseconomies of scale. b. economies of scale. c. diminishing returns. d. greater use of large-volume purchases.
If the government purchases multiplier equals 2, and real GDP is $14 trillion with potential real GDP $14.5 trillion, then government purchases would need to increase by ________ to restore the economy to potential real GDP
A) $7.25 trillion B) $1 trillion C) $500 billion D) $250 billion
For which of the following goods would you most likely observe the characteristic of excludability?
A. A professional baseball game. B. A concert in the city park. C. An interstate highway. D. Exterior Christmas lights.