Under a rule of reason approach, which of the following would be legal in the United States?
A. The merger of Paco's Taqueria and Maria's Mexican Bistro, independent restaurants in the unconcentrated sit-down restaurant market.
B. Price fixing between IBM and Compaq.
C. Ford and General Motors electing the same person to their boards of directors.
D. Kellogg's and General Mills collude to drive Quaker Oats out of the business.
Answer: A
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Of the following, which good has the most elastic demand?
A) food B) breakfast food C) cereal D) Post Raisin Bran E) Post Raisin Brand purchased at a Safeway grocery store
La Dila and Swiss Pro are the only two firms in an industry. The firms initially charge equal prices for their products, which are perfect substitutes. What happens if La Dila decides to lower its price slightly?
A) La Dila will lose all its market share. B) Swiss Pro will gain market share. C) La Dila will face the entire market demand. D) Swiss Pro will earn positive economic profits.
A firm will maximize profit by producing that level of output at which
A. total revenue equals total cost. B. the additional revenue from the last unit sold equals the additional cost of the last unit. C. total revenue exceeds total cost by the largest amount. D. the additional revenue from the last unit sold exceeds the additional cost of the last unit by the largest amount. E. both b and c
Draw a saving-investment diagram to show how each of the following changes shifts the IS curve.(a)Future income rises.(b)The future marginal productivity of capital increases.(c)Government purchases decrease temporarily.(d)The effective corporate tax rate increases.
What will be an ideal response?